A DAP parliamentarian has pointed out how it is better for the government to postpone the implementation of the Goods and Services Tax (GST) until it will not require an extensive list of exemptions.

“Given the need for an extensive list of exemptions, it begs the question as to whether the government has been too hasty in its attempt to implement the GST,” said Petaling Jaya Utara MP Tony Pua in a statement today.

Prime Minister Najib Abdul Razak in his Budget 2015 speech last Friday, announced a slew of additional exemptions to the GST on top of the existing list of tax-exempt and zero-rated goods and services.

Admitting that the desired impact from the exemptions was to lower the cost of goods, Pua said the GST will only be a more efficient tax than the existing sales and services tax if the list of exemptions is kept to a minimum.

“By creating a lengthy list of exemptions, the GST becomes a confusing, cumbersome and complicated tax for all stakeholders,” he said.

Pua ( right ) said the criticisms against the GST system were well documented against countries with long lists of exemptions.

“This is because it introduces disproportionate high costs of doing business, extensive litigation as well as much heavier burden on the tax authorities to enforce compliance.”

He also believes that instead of “rashly” implementing the GST, the government should instead focus on raising the income of the bottom 80 percent of Malaysian workers.

“Only after the income inequality is significantly reduced can the GST be implemented efficiently as a replacement tax regime without many of the tax-exemptions the government is seeking to provide today,” he said.

The new list of exemptions includes all types of fruits, white and wholemeal bread; tea dust, coffee and cocoa powder; yellow mee, kuey teow, laksa and meehoon; essential medicine covering nearly 2,900 brands; all reading materials, including colouring and exercise books as well as newspapers. GST-relief was also granted for the RON95 petrol and diesel.

Related stories

'Rosmah didn't get a single sen from Permata'

On PM's mocking, Anwar cites Umno founder

Low bumi equity blamed on Najib's underlings

'Budget shows KJ's power, may become DPM'

Borneo Highway’s RM5bil extra for Umno cronies?

Rafizi fires back - calls Najib a bigger bully

PKR deflects Najib's attack on Pakatan's budget

A tale of a thorny Budget

Housewives have 'hidden talents' to contribute

PM's Dept spending like there is no tomorrow