SUBANG JAYA, April 24 — The Malaysian Trades Union Congress (MTUC) announced today a May Day rally to protest against Putrajaya’s newly-approved consumption tax system and a US-led free trade agreement, among other workers’ rights issues.
MTUC deputy president Abdullah Sani Abdul Hamid said that both the Goods and Services Tax (GST) and the Trans-Pacific Partnership Agreement (TPPA) will affect the welfare of the 11.3 million-strong workforce in the country, who are already hit by the rising cost of living amid a weak implementation of the minimum wage policy.
“We have already informed the police and they have given their approval,” Abdullah Sani told a press conference at the MTUC office here today.
The trade unionists’ rally will take place at Dataran Petaling Jaya on Labour Day on May 1, better known as May Day, which is typically marked with mass protests around the world for workers’ rights.
Abdullah Sani explained that the TPPA, which is still at the negotiations stage, would expose local workers to unfair competition against large multi-national corporations from the US, Japan and Korea.
Although MTUC’s rally was given the green light, the police have declared a separate May Day rally, planned by NGOs like Solidariti Anak Muda Malaysia, at Dataran Merdeka in Kuala Lumpur, as illegal because the groups purportedly failed to obtain permission from the venue owners.
The protest by MTUC, an umbrella body representing over 800,000 workers from 390 labour unions nationwide, comes despite US President Barack Obama’s scheduled visit to Malaysia this weekend. According to reports, the controversial TPPA will be a key agenda during his trip.
Abdullah Sani, who is also Kuala Langat MP from PKR, claimed that the allegedly secretive pact involving a dozen countries would increase the price of generic medicine.
“We’ll also have to refer to international bodies, instead of using our local laws,” said the lawmaker, raising a common concern that the TPPA could threaten national sovereignty by allowing American corporations to sue the country to protect their interests.
The MTUC’s protest against the GST, which is scheduled to be implemented next year, follows heavy criticism by the Pakatan Rakyat (PR) opposition pact who says that the consumption tax will merely widen the gap between the rich and the poor.
The GST was mooted by Putrajaya as part of its bid to rein in the government’s ballooning debt that is hovering just below the 55 per cent ceiling mark.
After just two days of debate, the controversial GST Bill was passed in Dewan Rakyat earlier this month, with 119 votes for and 81 votes against.
The Bill also went through the committee stage reading with no amendments, ensuring that the consumption tax starts at a flat rate of six per cent beginning April 1 next year.
The GST is a consumption tax, which means all Malaysians will be taxed according to their level of spending, regardless of income. This differs from income tax that is only applicable after a certain salary level is exceeded.
Detractors have argued that the broad-based tax is “regressive” and takes a larger percentage of income from those in the low-income groups than from high-income groups.
But economists, however, have viewed the GST favourably, saying that it is necessary to broaden the tax base, but cautioned the government to cut wastages and leakages at the same time to improve the country’s finances.