Sunday, December 28, 2008

Spectre of GST

I had written about the portent of the Goods and Services Tax being introduced in Malaysia by a Federal Government that is increasingly desperate for more revenues to support the bloated Civil Service. To make matters worse, the Federal Government is finally beginning to worry about Malaysia' dwindling oil reserves.

Now the spectre of GST is getting more ominous. Read the Malaysian Insider report entitled, Rethinking GST option to maintain revenues. This is a trial balloon leaked out to test public reaction to GST. It is also a way to alert the Malaysian public to get used to the idea that GST is going to happen.

Better start preparing for the impact of GST. I suspect that the GST rate will 2% to 3% of the value-added on any goods and services consumed in Malaysia.


walla said...

One of the things they should take pains to iron out first is how to communicate anything effectively to the people.

Take service tax, for instance. There was some muttering it was repealed. But some outlets still continue to collect. Question then is: off, or on and under what conditions? If people are not clear, they can be subject to scams. You can be pretty sure service tax has been collected when it needn't be, and the term can be mixed up between 'service tax' and 'service charge' and 'government tax'.

That's just for food. Multiply that situation for everything else and you can imagine what can happen, more importantly how much more it will cost to solve the mess:

Think about the fuel rebate and the commission:

As for government spending on civil service, plans are afoot to raise wages for one large sector by a direct payscale jump method- that's going to cost mega-millions which will add to the other future debts from the recent additional benefits. All these wouldn't be so unreassuring if we didn't know our oil and gas are dwindling fast.


i look forward to that teh session with satD too.

Ti Lian Ker said...

Thank you Bruther for yr comment on Dante but it is not so in real life...I tried to be neutral and maintain my moral principles but was ridiculed instead..haha

de minimis said...

bro walla

True to form, you have, once again, pointed out some weaknesses in the government's delivery system. Poorly managed, the GST issue will be viewed negatively as another burden foisted upon the rakyat.

The GST has to be "sold" carefully by allowing the issues, for and against, to be ventilated. The eventual decision and shape of the GST will be more widely received.

Has the party in power (yes, they are still in federal power) got the deft skills to approach the issue carefully? Or, will they resort to the steamrollering that they are so used to?

bro TLK

Your bitter experience reminds me why I eschewed active politics despite having been active in campus politics. But, take heart that regardless of how partisan your blog posts are, it reminds the rest of us that you still have the passion, the fire is still in your belly and, above all, you are still sincere in maintaining your ideals. I hope the buggers in your party will recognise your abilities once again.