Implementation of GST put off

THE government has put off implementation of the Goods and Services Tax (GST), which was scheduled for 2011, indefinitely, says Second Finance Minister Datuk Seri Ahmad Husni Mohamad Hanadzlah.

The Cabinet has yet to decide on a specific timeframe for the implementation as it wants to ensure the welfare of the people is first protected, he said.

"The implementation of GST next year may be off," he told reporters at the National Taxation Conference 2010 in Kuala Lumpur yesterday.

GST was tabled in Parliament last December for its first reading.
It was to have been debated and passed during the last meeting of Parliament, but widespread resistance had prompted the government to withdraw the bill to obtain more feedback.

There were worries that unscrupulous traders will take advantage of the situation and raise prices of their goods to get more profits and use GST as an excuse.

It was said that based on this fear, the government had decided that the GST would only be introduced after the Anti-Profiteering Bill is passed and introduced.

The bill is expected to ensure that indiscriminate price hikes are stopped following the implementation of the GST.

"With GST, sales and services tax which are now at between 5 and 10 per cent will drop to only 4 per cent," Ahmad Husni said.

The GST has so far been implemented in 146 countries. In Asia, only Myanmar, Brunei and Malaysia have yet to implement the taxation system. - By Azlan Abu Bakar and Nor Ain Mohamed Radhi


- by Business Times