Chief Minister Lim Guan Eng has vowed to stand by the people, to ensure their well-being and strive towards Penang being a state free of the goods and services tax (GST).

Among others, Lim said, the GST haunts petty traders, including sundry and traditional medicine shops owners who felt they are unable to comply with the GST requirements.

Four of such traders from Balik Pulau visited his office on Monday, complaining that they were forced to wrap up their businesses due to the GST, he added in a statement.

Lim proposed that the threshold for sales liable for GST be raised from RM500,000 a year to RM2 million a year, for the benefit of such petty traders.

“Due to the depreciation of the ringgit, the threshold of RM500,000 may be easily achieved but the GST requirements will further burden these petty traders,” he said.

“Likewise, the GST will also be applied to all bank transactions, where personal account holders cannot reclaim the money deducted as they are not traders or businessmen, and they are not registered with the Customs Department.

“The account holders should be allowed to register to reclaim the GST amount charged for bank services,” he said.

'Lighten the burden of the people'

Lim urged Prime Minister Najib Razak to consider Penang’s proposals so as to lighten the burden, among others, of those affected by the recent floods in the East Coast of the peninsula.

“Since you (Najib) have admitted that the GST will increase the rakyat’s cost of living, it is necessary to defer it, especially at a time when the people are facing such difficulties,” he argued.

To strengthen his case, Lim has written an official letter to Najib, urging him to postpone the implementation of the GST.

He said the Penang legislative assembly on Nov 14 last year has passed a resolution to urge the federal government to defer the tax until the country becomes a high income, developed nation.

The resolution was passed as there are problems and implications for the rakyat and country that are still not prepared to face an “uncontrollable inflation” situation, Lim added.

“The state assembly decided that the GST will be regressive; it will not only burden the low- and middle-income groups, but will also affect the poor who live from hand-to-mouth. This tax will further burden them,” he explained.

“The state assembly also insisted that the implementation of the GST appears only to be a convenient route for the federal government for failing to manage the country’s economy, especially in its effort to combat corruption, leakages and wastage,” he added.

“Therefore, the federal government should focus on efforts to govern the country efficiently with accountability and transparency to avoid misappropriation, stop making the rakyat scape-goats.”

Lim said the Penang assembly truly understood the difficulties and burden of high living costs faced by the people when the GST, introduced by the federal government last year, is implemented on April 1.