PONTIAN, Oct 4 — A bellicose Datuk Seri Najib Razak today insisted that the unpopular consumption tax he introduced in 2015 has been acknowledged to be more transparent and beneficial to Malaysia’s economy than the new tax system that replaced it last year.
The former prime minister who was visiting Tanjung Piai here as part of his ongoing Bossku campaign amid his multi-billion ringgit corruption trial over the 1Malaysia Development Berhad (1MDB) financial scandal claimed the revival of the sales and services tax (SST) replacing the goods and services tax (GST) had resulted in a RM24 billion a year loss to the government.
“It is now proven that the GST is better than the SST,” Najib said during a stopover at Kedai Makanan dan Minumam Farhan in Jalan Kukup here.
He had earlier dropped in Burasak Abah in Pekan Nenas, which is part of the greater Tanjung Piai parliamentary constituency, and was greeted by hundreds of supporters at both locations chanting Selamat Datang ke Tanjung Piai, Bossku and Hidup BN slogans.
Also present at the event was Pontian MP and Umno supreme council member Datuk Seri Ahmad Maslan as well as Tanjung Piai Umno division chief Datuk Jefridin Atan.
Najib, who is also Umno adviser, claimed the benefits of GST have been acknowledged by the Federation of Manufacturers of Malaysia (FFM) for the tax exemptions and inputs on export goods.
“The act of abolishing GST has also resulted in losses due to leakages.
“GST is more transparent as those who are rich will pay more, and those who are earning less will also benefit,” said Najib, who is Pekan MP.
Ahmad, a former deputy finance minister, said the now abolished GST was a progressive tax where the rich will pay more.
“The GST is still more efficient and transparent than the SST. With the GST, people know how much tax they are paying,” said Ahmad.
He said it is only a matter of time for the Barisan Nasional (BN) to be vindicated following a recent call for the revival of the GST, and Prime Minister Tun Dr Mahathir Mohamad’s reply that his Pakatan Harapan (PH) government will look into bringing it back if the public is in favour of the tax.
“The truth will prevail sooner or later,” said Ahmad in an apparent dig at the PH government as he has been championing the GST in the past.
The Malaysian Institute of Economic Research chairman Tan Sri Kamal Salih mooted returning the GST in his Budget 2020 during a press conference in Kuala Lumpur two days ago.
Kamal said the GST was more transparent and efficient than the SST in raising government revenue when global crude oil prices fell and should be brought back, but capped at 3 per cent instead of 6 per cent.
The by-election will also be the first in which 18-year-olds can contest, though they may not vote yet.