A Goods and Services Tax Bill has been tabled in Parliament today.
The GST is a tax on your consumption/expenditure – though it may be mitigated by tax credits and a range of exemptions on essential items.
Proponents say it will broaden the tax base and ensure that the rich too will pay taxes – especially on luxury items – instead of escaping due to loop-holes in the tax system.
Critics argue that it is a regressive tax that will widen income disparities and result in the poor paying taxes for the first time (whereas under the present income tax system, they are exempted). Unlike in the developed nations, the majority of Malaysians do not pay income tax because of their low income; thus, they cannot receive a tax credit to reimburse them for the GST they would incur on a basic level of expenditure. Critics say it would make more sense for the government to raise money by cracking down on corruption and plugging “leakages”.
Here’s your chance to make your voice heard. If they don’t listen to you, you know what to do at the next general election.