PUTRAJAYA: The Government is still studying all tax systems in the world, including whether or not to reintroduce the Goods and Services Tax (GST), in the country.
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said 175 countries had introduced the GST as it contributed to the country’s Gross Domestic Product (GDP) because the Government’s tax revenue would be relatively low without the GST revenue.
Speaking to reporters after attending Aidilfitri open house organised by Putrajaya Media Club here Wednesday, Tengku Zafrul said the process to reintroduce the GST had taken quite some time as the tax had been abolished before.
“If the study found that the GST benefits are clear, we will take it to the Cabinet. The final decision is not for the Government to make, it’s for the Parliament,” he said.
Tengku Zafrul said the fastest the GST could be reintroduced is about nine months after it gets the green light from the Parliament.
The GST of six per cent was introduced in 2015 before it was abolished in 2018 by the then ruling government.
Tengku Zafrul said the study is now at the engagement stage as one of the issues was to ascertain a fair rate of three to four or seven to eight per cent, other than looking for an alternative to improve the existing Sales and Services Tax (SST) which had been rendered inefficient and caused many countries to introduce the GST.
When asked about the fair rate of GST, the Minister said whatever it is, it should be able to generate a higher revenue than the existing tax system.
He said some countries had even imposed a higher rate as they were able to give so many exemptions like in Saudi Arabia which imposed 15 per cent GST due to the high revenue from higher oil prices.
“There should be a study on the fair rate so as to generate revenue for the country’s development, while at the same time ensuring that it will not burden the people and the business community,” he said.
Meanwhile, Tengku Zafrul brushed aside talks on his political ambition, including the rumour that he will be contesting the Kuala Selangor parliamentary seat.
“My focus now is on the country’s economic recovery efforts.
“Right now, I am still working at the MOF (Ministry of Finance) and not thinking about politics. We have been facing very difficult challenges managing the economic recovery, so I am focusing on my work,” he said.
He said this in response to queries if he was targeting the Kuala Selangor parliamentary seat for his electoral debut in the 15th General Election (GE15) on an Umno ticket.
It was reported that the MOF’s adoption of Kuala Selangor district and his frequent visits to the area were clear signs that Tengku Zafrul would be contesting the parliamentary seat in GE15.
The Kuala Selangor parliamentary seat is currently held by Datuk Seri Dr Dzulkefly Ahmad of Amanah, who was earlier reported to have said he would not contest in GE15 because he wanted to give way to the party’s young leaders.
When asked further on his intention to contest, Tengku Zafrul firmly said:
“Not at this point in time”.
