GST is effective and transparent

AS A RETIREE, I should be the one rejecting the implementation of the goods and services tax (GST), instead I have been very supportive of the move since its implementation in April 2015. Implementing GST is not only a wise move but also a step in the right direction for Malaysia towards becoming a progressive nation. We can't depend on crude oil as a sustainable source of revenue on a long-term basis.

It is an inconceivable proposal to abolish the GST as announced by Pakatan Harapan chairman Tun Dr Mahathir Mohamad recently, if the opposition coalition were to win the forthcoming 14th general election.

By doing so, the GST will be replaced by the inefficient sales and services tax, which has long been abandoned by most countries, especially the western world. Presently there are more than 160 countries, with the latest being India, which have adopted GST as a reliable and transparent tax regime.

A responsible government has to manage its financial resources efficiently and prudently. With more revenue collected through GST, the government is in a better position to reduce its existing debt.

As Malaysia has been running a deficit economy for a long time, there is an urgent need to rectify the weakness, otherwise the country is vulnerable to a national debt crisis similar to the one encountered by Greece. If that happens, the entire nation will have to endure harsh austerity measures to fix the problem and it will take years for the economy to recover.

Our government shouldn't overlook the bloated public workforce of 1.6 million, which is causing a big dent to the country's coffers. The estimated emolument costs to be incurred on the workforce come to a staggering RM77.4 billion for 2017, while revenues to be collected for the year only amount to RM219.7 billion. The current ratio between emolument costs and revenues is 35.2%, as compared to 23.3% 10 years ago. The pace at which emolument costs is growing is worrisome.

I believe many pragmatic taxpayers like me are supportive of the GST implementation. In return, we expect the government to be more responsible and accountable in handling taxpayers' money. Malaysia dropped one point in Transparency International's Corruption Perception Index (CPI) in 2016, scoring only 49 out of 100. There must be real commitment to improve the CPI, otherwise the menace would not only persist but also worsen in the near future.

Obviously many senior citizens like me haven't forgotten the impact of the 1997/98 Asian financial crisis that had brought Malaysia to its knees. Although we had the ability to overcome the crisis without help from International Monetary Fund then, our economy suffered a big blow and many lives were thrown into turmoil. The share market collapsed along with many companies, big and small, causing thousands to lose their jobs.

I hope our former prime minister, Mahathir, hasn't forgotten how much damage the Asian financial crisis caused the nation. He shouldn't continue to treat Petronas as a cash cow that can always be relied on to provide substantial financial support to the government. Crude oil is a depleting natural resource and the good old days of high crude oil prices are long gone.

Patrick Teh