KUALA LUMPUR: The government is still studying the suitability of implementing the Goods and Services Tax (GST) and the usage of other taxation models, said the Finance Ministry.
It said the study took into consideration all aspects including the weaknesses of the existing Sales and Services Tax (SST) and the GST which was implemented in 2015.
“The study being carried out also covers the impact on the economy, cost of living, cost of goods, as well as ability to address the shadow economy (or black market),” the ministry said in an oral answer published on the Parliament’s website Monday.
The Finance Ministry was replying to Su Keong Siong (Kampar-PH) on whether the government intends to reintroduce the GST implementation.
The ministry said the new tax, if implemented, also must be easily manageable and does not increase the cost of doing business besides being able to strengthen the nation’s fiscal position.
It added that the country’s economy is currently in the recovery phase and the implementation of any form of tax must take into account the prevailing scenario.
“In addition, it would also provide space for careful preparation by both the government and taxpayers,” the ministry said.
Meanwhile, the federal government’s SST collection for 2021 amounted to RM25.48 billion, comprising sales tax collection of RM13.49 billion and services tax of RM11.99 billion.
In 2020, the SST collection totalled RM25.25 billion, consisting of RM13.24 billion from sales tax and RM12.01 billion from services tax. - Bernama