The government will take “at least” three years to resolve its debt and refund repayments, Finance Minister Lim Guan Eng said today.

“We will need at least three years to resolve the fiscal issues caused by the RM1 trillion debt and the RM35 billion in (outstanding) GST and income tax refunds,” he told a roomful of investors at the “Malaysia: A New Dawn” conference in Kuala Lumpur this morning.

The RM35 billion figure was achieved by combining RM19 billion in outstanding GST refunds and RM16 billion in unpaid income tax refunds.

Admitting that this recovery process would be “painful”, Lim nevertheless vowed to return all outstanding tax refunds to their rightful claimants.

“As painful as it may be, this money doesn’t belong to the government.

“And this administration has made it a moral imperative to refund RM35 billion back to companies and the people of Malaysia.

“However, the silver lining is that this enormous refund exercise will certainly act as a major stimulus to our private consumption and investment,” Lim added.

BN ‘overstated revenue’ in budget speeches

As he had said before, the minister reiterated that the previous BN administration was to blame for the state of the country’s economy.

He revealed today that not only had BN been engaging in “creative off-balance sheet accounting”, it had also been overstating government revenue.

“While the creative, off-balance sheet debts by the previous administration were not a surprise, we were taken completely off-guard (when we) discovered government revenues had also been overstated in the previous budgets to present a false picture of prudent fiscal consolidation,” Lim said.

In line with his promise to be an “honest finance minister”, Lim had in his speech forewarned investors to brace for “pain and sacrifice” in the upcoming budget.

Lim is set to present the Budget 2019 on Nov 2 in the Dewan Rakyat.