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RM23b

SST collects RM23b less than GST, Guan Eng tells Umno
Lim also said that the Ministry of Finance has undertaken a comprehensive SST review exercise with the assistance of accounting firm PricewaterhouseCoopers (PwC) to simplify SST. — Picture by Sayuti Zainudin PUTRAJAYA, July 17 — Finance Minister Lim Guan Eng questioned today how the Sales and Services Tax (SST) would be more burdensome than the Goods and Services Tax (GST) when the former collected RM21 billion annually compared to the latter’s projected RM44 billion.Lim also dismissed claims that the Pakatan Harapan (PH) government’s decision to revert to the SST system of 10 per cent sales tax and 6 per cent services tax meant a higher tax rate of 16 per cent than the GST’s 6 per cent, saying that the sales and services taxes could not simply be added up.“Umno and former prime minister Datuk Seri Najib Razak must explain how Sales and Services Tax (SST) burdens the people more as compared to the Goods and Services Tax (GST),” said Lim in a statement.The federal government intends to revert to the previous system that was in place prior to the GST by implementing the SST on September 1, 2018.The SST will replace the GST, which will be repealed accordingly.“False claims by Umno that the SST will burden the people even more than the GST is illogical when SST collects RM23 billion less than GST,” added Lim.Lim cited the example of the 6 per cent service tax, which was applicable to selected services, unlike the GST, and the sales tax, which is imposed on manufacturers’ and importers’ price, while the GST is imposed on the final consumer price.“Hence, it is wrong to claim that a ‘10 per cent Sales Tax is higher than a 6 per cent GST’.“For example, a manufacturer imposes a 10 per cent Sales Tax (RM0.10) on a can of soft drink manufactured for RM1.00. However, when the same can is sold to a consumer at 7-Eleven for RM2.00, a 6 per cent GST of RM0.12 would have been imposed. In this case, it is clear that a 6 per cent GST at RM0.12 would be higher than a 10 per cent SST,” said Lim.Lim also said that the Ministry of Finance has undertaken a comprehensive SST review exercise with the assistance of accounting firm PricewaterhouseCoopers (PwC) to simplify SST.“PwC will help rationalise tax collection and reporting requirements to ensure that the SST will be even more efficient and less bureaucratic than the GST, or even the old SST system. PwC will ensure the SST imposed on September 1, 2018 to be simpler, less cumbersome, prevent leakages and loopholes,” he said.Lim also said the new SST will be tweaked to minimise the impact on poorer people.The details of the improvements will be announced when the new SST Bill is tabled in Parliament during the current session. [...]
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