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MP calls for GST reduction amid weak economy
Published:  Jun 23, 2015 12:12 PM
Updated: 4:23 AM

Kluang MP Liew Chin Tong has called at the very least for a reduction in the Goods and Services Tax (GST) if not an outright suspension, amid the current weak economic conditions.

 

This, he said, should be done after a whole-of-government approach review of the GST which is completing its first quarter of implementation.

 

"This is urgent, given that the wider economic conditions are worsening, especially with the ringgit having fallen to a nine-year low," he said in a statement today.

 

Liew ( photo ) acknowledged that while there were beliefs the weak ringgit can help boost exports, this does not appear to be happening. 

 

As such, he said Malaysia can only rely on domestic consumption for its economy recovery, but it is impeded by GST.

 

"Malaysia’s exports are not growing due to the slowdown in China, Europe and Japan while recovery in the United States is still not strong. 

 

"Regardless of how the ringgit falls it will not help Malaysia’s export market too much.

 

"In such context, the Malaysian economy is standing on one leg, that of domestic consumption, which the GST threatens to eclipse," he said.

 

Aside from choking domestic consumption, Liew said the GST is also increasing the cost of doing business in a difficult economic time.

 

In particular, Liew said the government's price control and anti-profiteering mechanism was not working well.

 

"The government is trying to regulate the price of individual products. Margin of a product must not exceed the price of 2nd January 2015. 

 

"This is most ridiculous as most businesses manage their stocks based on categories. 

 

"Further, margin is calculated by businesses as a percentage, not an absolute figure," he said.

 

As such, Liew said a first quarter review of GST is urgently needed before the economy is "tanked by GST and the falling ringgit".

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