The goods and services tax (GST) is likely to be reintroduced but not anytime soon but perhaps in 2022.
According to the economist, Associate Prof Dr. Ahmed Razman Abdul Latiff, although GST is enough to be seen as an efficient and comprehensive initiative, looking at the current spending of Malaysians, it is not suitable to implement it any sooner.
Apart from that, based on the retail and wholesalers index in November, the spending trend is still showing a declining pattern, as reported by Astro Awani.
“This GST may be introduced in 2022 when the economy is expected to recover but at a low rate.”
In an interview with Bulletin Awani, Dr. Ahmed Razman said the GST percentage can be introduced again but maybe at a lower percentage than before.
“Not six per cent, maybe four per cent so that at least the government has the opportunity to increase the tax rate if there is a need for the government to increase revenue.”
“But for next year, the focus should be on controlling spending planned in the 2021 Budget so that there is no leakage.”
He also said that the government should think of alternatives to boost the economy without increasing debt or adding new income and tax revenue.
These days, when people talk about the economic crisis, it is due to the liquidity, as people don’t have enough cash to do business transactions.
“Actually, the money is there, but it is held, stored, and not spent by certain groups, causing the B40 and M40 groups, especially those who do not have enough money to spend, including Small and Medium Industries (SMIs).
“What the government is doing through the stimulus package, Budget 2021, is to directly channel government allocations or projects so that money enters the market, more transactions can be done,” he said.
