Implement people-centric economic policies

AFTER being zero-rated from June 2018, the goods and services tax (GST) which was introduced in April 2015 has finally been abolished. Beginning September the sales and services tax (SST) will be reintroduced.
Although supported by economists as the most effective broad-based consumption tax regime, the GST has unfortunately been solely blamed for spiralling cost of living, when as a matter of fact there were many other contributing factors. Now we also know that the delay in input tax reimbursement is also a factor which caused working capital constraints on businesses.
Over-reliance on income, petroleum and other commodity tax is definitely risky taking into consideration the volatile global economic outlook. If oil prices could crash in 2015, it can happen again at any time.
It is common knowledge that the SST regime contains loopholes providing an opportunity for errant individuals and businesses to manipulate and subsequently dodge tax, which is almost impossible with the GST system. When businesses are able to manipulate and dodge tax, the end price of goods and services which they sell or render becomes artificial. They do not reflect the actual value. With the introduction of the GST, prices of goods and services did not increase but it merely reflected its actual economic value in the market which is higher than what it was before.
When this happened consumers protested because their purchasing power reduced significantly. Why did the purchasing power reduce, it was because wages were kept artificially low by our country's overreliance on foreign labour. Foreign labour have not only taken over blue-collar employment segment but also infiltrated businesses and services which were traditionally performed by Malaysians, leaving us vulnerable.
With the reintroduction of the SST the debate on whether prices will increase, remain or go down has again taken centre stage. We will soon see enforcement teams visiting retailers (not suppliers) checking if there is profiteering. Will this be effective when Malaysia is a market-driven economy? Can the government control price increases? I think it is impossible!
The only long-term solution available for the government is to implement policies which will help increase the disposable income of the people, reflecting actual market value. All other actions will only be cosmetic.
To consumers, we must accept the fact that the era of cheap goods and services is over. We will have to look at our own consumption pattern to stretch our ringgit. Let's focus on our needs rather than wants and demand that the government implement people-centric economic policies.
Darshan Singh
Kuala Lumpur