GST: Consumers will likely adopt 'wait-and-see' attitude
Published on: Wednesday, March 25, 2015
Kota Kinabalu: Experts predict consumers will likely adopt a "wait-and-see" attitude for three to six months after the implementation of the Good and Services Tax (GST) and delay some of their purchases."We believe this will happen in Malaysia like it did in some other countries upon the implementation of GST," said Bank Negara Malaysia Assistant Governor Marzunisham Omar.He said based on their forecast private consumption would fall slightly to about six per cent this year, taking the GST into account, from the 7.2 per cent registered last year.
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"But the positive growth of our income as well as the employment situation will help consumers to continue to spend," he added at the Forum on Economic Outlook 2015 at Le Meridien, Tuesday. Although low palm oil prices might affect the State's economy this year, Marzunisham said his engagement with some of the companies in Sabah indicated that they were optimistic in a certain number of projects."Therefore, in terms of private investments, I believe the consumption will remain resilient as well," he said, adding that they could still attract investments through several major investments in food and beverages, halal hub as well as the aquaculture industry. He also touched on the exorbitant prices of houses in Sabah and advised consumers to purchase homes based on affordability.
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"There are specific reasons why the price of houses in Sabah is high and my point is that everyone wants to own a house but we must look into our income. It determines how much loan we can receive and what sort of houses we can afford."Of course if our average income is about RM3, 000 a month, it will be impossible for us to purchase a house worth over RM400, 000. Banks are unable to offer loans because the people can't afford to pay…we cannot live beyond our means."
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He urged developers to sit and discuss with the State Government in order to find a win-win solution for the people."This is a national issue and parties concerned should cooperate with one another and come up with a solution. "We're aware that the housing development and construction industry play an important role in the development of our country and at the same time we also know that house ownership is very close to Malaysians but given the average income, some houses have become unaffordable to most," he said. Towards this end he spoke of the need for local employee wages to increase as part of the effort to reduce foreign labour as well as moving towards a high income nation."We must stop relying on foreign labour … there are certain economic activities such as in the plantation and construction sectors where the employment of foreign labour is very high."We recognise the constraints companies faced because not many Malaysians want to work in both the fields. "The point about foreign labour is that we have to try to see how best we can reduce the reliance and this what I meant about increasing productivity and efficiency among local employees by providing them training apart from paying them higher wages," he said.Stay up-to-date by following Daily Express’s Telegram channel.
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