Explain how integrated GST-SST system will work, govt told

Government urged to clarify hybrid GST-SST system details

Prime Minister Anwar Ibrahim revealed during a 2027 budget engagement session that the Malaysian government is evaluating a system that merges components of the Goods and Services Tax (GST) and Sales and Service Tax (SST) to create a more progressive tax structure. Wan Ahmad Fayhsal Wan Ahmad Kamal, information chief of Wawasan, called on the government to elucidate how this proposed hybrid tax system would function.

Wan Ahmad Fayhsal questioned the rationale behind introducing such a transformation without a comprehensive impact study and compliance cost assessment, especially considering the potential consequences for consumers and businesses. He emphasized that the government should clarify key aspects of the proposed system, including tax rates, the scope of goods and services, registration thresholds, and the handling of input tax credits.

Additionally, Wan Ahmad Fayhsal highlighted the challenges faced by small and medium enterprises, such as the recent implementation of e-invoicing alongside rising costs related to raw materials, utilities, energy, logistics, and wages. Any new tax system would introduce further expenses, including software and staff training, accounting fees, and restructured invoicing procedures, he argued.

He questioned the necessity of incorporating GST elements into the proposed hybrid system, especially when the government views SST as a more targeted and efficient tax structure. Wan Ahmad Fayhsal stressed that the public seeks policy stability, rate certainty, a user-friendly system, and assurance that tax changes will not exacerbate living costs. Without clear information on the hybrid proposal, the system might simply become another "Madani tax" in name only.