BN robbed businesses of GST refunds, Guan Eng tells Parliament

Finance Minister Lim Guan Eng speaks to the press outside Dewan Rakyat, August 7, 2018. — Picture by Hari Anggara
Finance Minister Lim Guan Eng speaks to the press outside Dewan Rakyat, August 7, 2018. — Picture by Hari Anggara

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KUALA LUMPUR, Aug 7 — Finance Minister Lim Guan Eng today accused the previous Barisan Nasional (BN) government of stealing tax refunds under the Goods and Services Tax (GST) that were meant to be returned to businesses.

A visibly angry Lim tried to hold back his temper before lashing out, telling Parliament that it was this reason that made the system problematic under BN.

“If you all don’t know what is the real reason as to why GST refunds were not given, I suspect Jeli maybe knows,” Lim sarcastically said, referring to former International Trade and Industry Minister Datuk Seri Mustapa Mohamed.

“This is a very serious matter, which was supposed to be paid in two weeks. But for two years it was not paid, because the money paid as advance was not included into the trust account, but put into a consolidated fund, as revenue, and because it was assumed as revenue, was used up by the previous government!

“That is the reason. When you said, you want to reform GST, it is not a reform, but a robbery of GST!

“This is a very serious robbery, whereby money that was supposed to be in the trust account, was not in the trust account,” Lim screamed in the Dewan Rakyat, visibly stunning Rembau MP Khairy Jamaluddin.

“How will the current government then pay (GST refunds), if money is not in the trust account?!” Lim screamed again.

It is unclear what Lim meant by a trust account, as he did not deliberate further, but such accounts are traditionally used to hold funds, to be channeled for specific purposes.

He then proceeded to ask Khairy, if the latter realised the problem when he was a minister.

“You should know. You should know the accounts. If you read through the accounts, you should know. As a minister, you have the responsibility to look through the accounts! You have failed!” Lim lashed out at Khairy.

Khairy had initially asked Lim to fully explain about the input tax claims, which were not returned by the government.

He told Lim that he was informed that there were many cases with refund problems for amounts between RM7 billion and RM8 billion every year, because there were problems within the Customs Department.

The department had refused to release the refunds, as it wanted to first ascertain the claims.

Khairy said this was verified to him by the former finance minister II, who informed him however, that it was a normal issue.

He also told Lim that if the problem was only with the GST refund process, Lim could easily rectify that.

After Lim’s fiery response, Khairy then asked him to prove his accusation.

“All right. I will prove it tomorrow, when I table the Bill to abolish GST!” Lim said, taking Khairy’s challenge.

GST abolishment was one of PH’s 10 promises that it pledged to realise within 100 days if it won federal power.

The PH government is seeking to reintroduce the SST to replace GST, which has been zero-rated beginning June 1.

Earlier today, Finance Minister Lim had tabled the Sales Tax Bill 2018, Services Tax Bill 2018, GST (Repeal) Bill 2018 for the second reading before debate in Dewan Rakyat.

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