Opinion
The overtaxed middle class

APRIL 12 — I recently cycled 40 minutes in 33-degree weather just to save RM6 on parking when I went to a government clinic to collect my medication.

I was a little peeved when the nurse told me that I could only collect two months' worth instead of the usual three. She gave some excuse about records not tallying if patients are given three months’ supply.

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I suspect that government health facilities are yet again running low on medical supplies. But coming to the clinic once every two months and paying just RM1 for two packs of oral contraceptives still beats buying them at a pharmacy, where a pack can cost RM27.

So it annoyed me to read that, despite my efforts to save money, the Pakatan Harapan (PH) government is implementing three new taxes that disproportionately hit the middle class – a digital tax, a departure levy, and a tax on sugar-sweetened beverages.

Although the sugar and digital taxes are not direct taxes on consumers, soft drink manufacturers and foreign digital service providers like Netflix, Spotify and Steam will likely pass on the extra cost to their customers. Tax experts expect consumers to bear the 6 per cent digital tax that will also affect e-book subscriptions and app purchases.  

A report estimated an increase of RM3 for Netflix subscribers and RM1.40 for Spotify family users.

When PH introduced the departure levy in Budget 2019, it proposed to charge those leaving Malaysia for Asean countries RM20 and RM40 for those travelling to other nations.

These amounts may seem small, but every ringgit counts in the face of rising living costs and stagnant wages.

It is unfair of the government to tax the middle class while leaving the uber rich untouched.

The 1 per cent don’t have to worry about more expensive Netflix and Spotify subscriptions or about paying a departure tax whenever they go on regular Europe vacations, simply because they are filthy rich.

The poor generally escape paying tax since the goods and services tax (GST) was abolished, while the burden of developing the country falls on less than 10 per cent of the population who pay income tax.

To ensure that everybody has a stake in national development, taxes must be distributed in a fairer manner instead of simply burdening the middle class.

The poor should be taxed too, even if just a little, which is why the GST was a more equitable and transparent tax because people were taxed based on their consumption levels – the poor who consume fewer and cheaper goods get taxed less compared to the wealthy.

The 1 per cent, on the other hand, can afford to get taxed a lot more. If the government is desperate to raise revenue, then why not increase the income tax levels for those who earn more than RM250,000 a year? Raise it to 40 or 45 per cent from the current 24.5 to 28 per cent rate. 

Some may argue that the new taxes are acceptable since overseas travel and music and OTT subscriptions are not necessities, so people can easily quit those if they don’t want to pay tax. But this is not a question of affordability; it is an issue of fairness.

The rich get to go on with their lives, while the poor get all sorts of benefits – Bantuan Sara Hidup cash aid, free health screenings at private clinics through the Peka B40 programme, and a better shot at entering public university.

The middle class pay thousands of ringgit in income tax every year, but get nothing and are further taxed on top of that.  

Yes, in times of austerity, citizens must tighten their belts for the good of the nation. But it is difficult to do this when we see children of political leaders swanning around in Bentleys or hanging out with movie stars.

It is also hard not to feel resentful over the new taxes when the government comes up with unpalatable policies like a flying car, excessive regulations that could make e-hailing more expensive, or possible water price hikes despite frequent water cuts in the Klang Valley.  

For all PH’s talk about the economy, they spend an awful lot of time on things that don’t benefit the average Malaysian, such as the Rome Statute that subjects Malaysians to the International Criminal Court (ICC) if they commit international crimes like genocide or war crimes. The worst thing that happened in Malaysia was the 1969 race riots, and even those killings aren’t considered war crimes.

My effort to save RM6 in parking fees by cycling under the hot sun ended up costing me RM53 in medical bills when I contracted UTI shortly after, probably because I didn’t change out of my sweaty clothes quickly enough when my work shift started.

PH needs to quickly focus on improving people’s lives. Otherwise, the people may resent the government because of far worse pains than peeing pins and needles.

* This is the personal opinion of the columnist.

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