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Source: The Malaysian Times

Malaysia’s Parliament tables Bill to repeal Goods and Services Tax

Three taxation-related Bills were tabled in the Malaysian Parliament today on 31 July, including the GST (Repeal) Bill 2018 for its first reading, by the nation’s new Government.

The repeal of the 6% GST, or the Goods and Services Tax, was promised to Malaysians in the Pakatan Harapan (PH) coalition’s manifesto.

The GST, which was introduced during the previous Barisan Nasional administration under the lead of former premier Najib Razak, is a “regressive” tax “that oppresses lower income groups”, as it “has to be paid even by the poor”, according to the PH manifesto.

The two other taxation-related Bills that were tabled during the session are the Sales Tax Bill 2018 and the Service Tax Bill 2018.

The introduction of the two Bills is in line with the short-term measure proposed in PH’s manifesto, in which the coalition declared that the GST will be replaced with the Sales and Services Tax (SST).

Two other Bills out of the five Bills tabled today by Deputy Finance Minister Amiruddin Hamzah are the Customs (Amendment) Bill 2018 and the Free Zones (Amendment) Bill 2018.

Under both of the proposed sales and service taxes, any person who is found guilty in circumventing the taxes or participating in the abetment of such an activity may be imposed a fine of not less than 10 times, and not more than 20 times, the amount of either tax, or may be imprisoned for a period not exceeding five years, or sentenced to both fines and imprisonment as stated previously.

Repeat offenders will be subjected to twice the minimum or maximum amount sentenced upon first offenders, or will face not more than seven years of jail, or both fines and imprisonment as stated previously.

The second reading of the GST (Repeal) Bill 2018 is scheduled to take place on 7 August.

Previously, not long after the PH coalition was elected into power on the 9 May, Prime Minister Dr Mahathir Mohamad has expressed his confidence regarding the abolishment of the GST, stating that the government will continue to have sufficient revenue even without the imposition of the tax.