PAS has proposed introducing taxes on profits made from share trading and corporate deposits, to replace the regressive goods and services tax.

The party claimed this would bring in an estimated revenue of RM51.5 billion, surpassing revenue from GST.

It made this proposal in its Dokumen Hijau (Green Document), a document detailing the Islamist party’s proposed solutions to economic issues caused by GST, currency devaluation and rising cost of living.

PAS argued that while GST taxed the poor, taxation on corporate savings and share trading would target the rich.

“These funds (corporate deposits) belong to the rich and are excesses. In terms of velocity of money, it should flow to the poor and raise their purchasing power to boost national development and domestic demand."

Taxation on corporate deposits at 2.5 percent per annum were calculated based on the lowest accumulated savings for the year, it estimated.

Tax on share trading would also be 2.5 percent but in two forms, it proposed.

Long-term traders who held on to their equities for more than a year would be taxed 2.5 percent of the total value of the equity, according to the lowest value of the year.

Short-term traders who sold off their equities before one year would be taxed 2.5 percent of transaction value, it proposed.

PAS expected to earn RM37.5 billion a year from this.

"It is unreasonable that trade by the rich which generates high profits is not taxed, while small traders and from the poor and lower classes are taxed six percent GST whether or not they earn a profit."

Other proposals are:

  • Government soft loans to cover down payments for home purchases, with rates to be pegged to the purchaser’s income, to assist fresh graduates and newlyweds. This will replace government mortgages for civil servants.
  • Share-ownership of homes, where the value of the home is split up and purchased by several investors. The investor who resides in the home will pay the other co-investors rent, for their share of the home.
  • Cost of living allowance by private employers to support workers in the face of rising costs. This will assist employers who cannot afford to give their staff pay hikes.
  • Allocation of 25 percent of total government revenue for programmes to assist the bottom 40 percent earners, in line with zakat principles.
  • Import substitution by supporting localisation initiatives and local innovation projects.
  • Conducting value engineering to reboot government projects shelved due to currency devaluation.

Prime Minister Najib Abdul Razak will table the 2017 federal budget in Parliament tomorrow.

Pakatan Harapan presented its alternative budget yesterday which featured, among others, cuts reliance to GST, setting-up an equal opportunities commission, shrinking Prime Minister’s Department budget and subsidising a rise in minimum wage.