KUALA LUMPUR, March 10 ― Custom deputy director-general Datuk T. Subromaniam today labelled as “ridiculous” claims such as Tun Dr Mahathir Mohamad's assertion that the Good and Services Tax (GST) was driving businesses out of the country.

Subromaniam said the new consumption tax has instead improved efficiency in tax collection and reduced business costs, leading to more investments coming into Malaysia.

“If anybody gives any statement of that kind, (they) should base it on facts. I'm not referring to anyone, just a general statement,” Subromaniam said when asked to comment on Dr Mahathir's allegation at a press conference here.

“It doesn't make sense. We introduced the GST to reduce the cost of businesses so why would anyone want to move and relocate to a different country,” he added.

The criticism against the GST was included in the “Citizens' Declaration” read out by Dr Mahathir and signed by more than 40 government, opposition and civil rights leaders on March 4.

It was part of an ad hoc movement to oust Prime Minister Datuk Seri Najib Razak. The GST, which replaced the Sales and Services Tax, was introduced by his administration.

At the same press conference, Grant and Thornton's Singapore-based partner and head of indirect taxes officer Lorraine Parkin asserted that GST has actually increased investment into Malaysia, contrary to public belief.

“Last year foreign direct investment into Malaysia has increased, so there is more business investments in Malaysia because it started quite rightly so,” she said.

Parkin said GST helped boost Malaysia's appeal as an investment destination as the consumption tax created more transparency and efficiency.

“With the introduction of GST, the GST audit file and transparency, Malaysia has become once again a very attractive environment for businesses to invest and do business in.

“And you cannot look at GST in just isolation. It’s part of a whole economic reform package in a context of strengthening Malaysia's position in the world,” she said.

The Najib administration's popularity dipped immediately after it introduced the GST on April 1 last year.

Consumer sentiments have not picked up since, dropping to a five-year low in the first quarter of this year, according to data from banks and research firms.

Putrajaya has defended the new tax. Najib said the GST had helped keep the government running as revenue from oil dropped.

It has collected more than RM27 billion from GST in 2015, Subromaniam said today.