Removal of GST without adjusting measures credit negative: Moody's

PETALING JAYA: Moody’s Investors Service views plans to abolish the Goods and Services Tax (GST), if implemented without adjusting measures, as credit negative.
Moody’s Investors Service vice president and senior analyst, sovereign risk group,
Anushka Shah said while revenue losses this year will be offset to some degree by higher oil prices, this development is unlikely to be a structural -- or act as -- a permanent substitute for GST itself.
"The extent to which offsetting measures, if any, will help recover the revenue loss from GST will allow us to determine the exact impact on Malaysia’s fiscal position going forward. However, if GST is eliminated, it would increase the government’s reliance on oil-related revenues and would also narrow the tax base,” Anushka said in a statement today.