SST reinstatement will burden rakyat, says PM
KUALA LUMPUR, May 7 (Bernama) -- The rakyat will be further burdened if the Sales and Service Tax (SST) is reinstated to replace the Goods and Services Tax (GST), Datuk Seri Najib Tun Razak said.
The Prime Minister described the opposition's manifesto as an example of sedition and a perception gimmick as the GST was not the real cause of rising prices of goods and cost of living.
"For a growing economy, some of the cost of goods will increase, but after the GST was introduced in the country, the government has exempted about 600 items and services from the tax. Malaysia is the only country that gives such exemption."
"The opposition's promise on the GST is unrealistic and the prices of goods do not necessarily go down if the GST is abolished as the prices of goods are not controlled by the government," he said during an interview on TV3's 'Mandat' programme here tonight.
Najib said the GST rate at six per cent in Malaysia was among the lowest and its implementation was necessary as a long-term preparation to reduce dependence on oil as a source of national income in the future.
"We only produce 600,000 barrels of oil per day and we should have been saddled with a recession when world oil prices fell two years ago, but the GST saved the country," he said. Najib said the GST was planned earlier but it was not implemented then due to concerns over a political impact.
However, it is for the rakyat's welfare, maybe we have to face the impact from the political backlash. But sooner or later, the public will realise that this (the GST implementation) is the best step and benefits the rakyat," he said.
The government collected RM43 billion in GST last year to cater for, among others, the cost of health services, annual salary increments of civil servants, a two-percentage point reduction in individual income tax, aid to smallholders, special cash payments to civil servants and pensioners, and the 1Malaysia People's Aid (BR1M).
Najib, who is also Finance Minister, said the government did not focus only on the gross national income but also took into account the rakyat's welfare and income divide.
"So, if we were to practise a free and open economy totally without government intervention, the income gap between the high-income and low-income (B40) and middle-income (M40) household groups will widen."
"We have resolved that there must be social justice. That's why we had introduced BR1M, minimum healthcare cost, public transportation and so on," he added.
-- BERNAMA
