SST collection will eventually surpass that of GST, says Dr M

PARLIAMENT | Prime Minister Dr Mahathir Mohamad believes the revenue collection from the sales and service tax (SST) will eventually surpass the collection from the goods and services tax (GST), even though there was a shortfall by SST over the past year.

"Of course there was a shortfall in the revenue collection of SST but this shortfall is not because SST was a mistake but because when a new tax is introduced, at the beginning the collection always suffers a shortfall due to adjustments needed.

"But I am confident that in the years to come, SST will surpass the revenue collection of the GST," Mahathir said in the Dewan Rakyat today.

He was responding to Ismail Mohamed Said (BN-Kuala Krau) who had asked about the shortfall of RM20 billion in revenue collection after the switch from the GST to SST was made last September.

Earlier, Mahathir had said the government would need to conduct a thorough study before considering a re-introduction of the GST.

The study would have to look into the impact of the hike in prices on consumers, the inflation rate, increase in costs for businesses as well as the reimbursement system.

However, he did not seem keen on changing the tax system again anytime soon.

"A change in the taxation system should not be done too often because it will erode investor confidence and affect our image negatively," Mahathir said.

He said the government only changed the system from GST back to SST because there were a lot of complaints from the rakyat about the GST as they had to pay the tax twice or wait for their reimbursements, which never came.

The government is currently in the process of improving the implementation of the SST, he added.

"(The implementation of the SST) is going well and we need to improve the implementation of this new taxation system more, so there is no reason for us to go back to the taxation system which was rejected by the rakyat," Mahathir said.

He also poked fun at Ahmad Maslan (BN-Pontian) who had yesterday offered to be a free GST consultant to the Pakatan Harapan government.

"The former government had the good fortune of getting advice from a consultant who is not accredited, that is why they introduced the GST.

"Thank you for your offer to be a consultant, (but then) the government would be ruined," Mahathir quipped.

Yesterday, Ahmad Maslan had said he would volunteer to be an unpaid consultant if the Harapan government decided to revive the GST.

"If the GST is brought back, I can be their free-of-charge consultant. I can go around organising ceramah and explain the benefits of the GST to the people," he had said.

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