Good morning members of media, fellow colleagues of ACCCIM
Thank you for attending today’s media conference.
It has been more than one year since the implementation of Goods and Services Tax (GST) in Malaysia which took effect on 1st April 2015. There were issues and arguments encountered by the Government, business community as well as the end consumers since the implementation of this new tax regime. With joint collaboration and great efforts by the Ministry of Finance, Royal Malaysian Customs, business organisations and all stakeholders involved, many grey areas and shortcomings on GST’s policies and administerial matters were ironed out and gradually resolved.
As announced by the Government, since the implementation of the GST in April 2015, revenue collected by the Government for the period from April to December 2015 was more than RM 30 billion, exceeded the targeted amount of RM 27 billion. In 2016, the Government is expected to collect RM 39 billion revenue from GST. With the increasing number of GST registrants, we can foresee that the GST revenue will gradually increase over years.
Although the Government has repeatedly emphasized that GST will not add financial burden to businesses, the survey result, however, revealed in contrary that, more than 80% of the respondents indicated that GST has increased their costs of operation. These additional costs included the purchase of GST software, employment of additional staff and etc. Therefore, ACCCIM hope that the Government could utilize the GST revenue wisely, to create conducive business environment so as to ease the burden of the rakyat. At the meantime, ACCCIM also wish that the Government could accelerate lower the corporate tax rate to 18%, and to reduce the SMEs threshold taxable income to 15% for the first RM 2 million. We also urged the Government to lower the individual tax rate to 18% for the highest chargeable income bracket from 28%. By doing so, we will be able to enhance our competitiveness in order to attract more foreign direct investment as well as boost the taxpayers discretionary spending into the market place and thus increase the multiplier effects to bring back vibrancy into the economy.
Both Mr. Koong Lin Loong and Mr. Lee Hooi Seng, being the Chairman and Deputy Chairman of ACCCIM Taxation Committee, are members of GST Monitoring Committee of the Ministry of Finance and GST Technical Committee of the Royal Malaysian Customs. Through these platforms, ACCCIM will continue to play an active role in monitoring and resolving issues related to GST. Matters discussed and decided by these two committees will be uploaded by Royal Malaysian Customs to their GST Portal for reference of public. However, the survey shown that only 36% of the respondents aware of this channel for checking updates.
We hope that both business community and consumers will become more proactive when encountering issues related to GST, by approaching the Customs to seek for clarification. Likewise, businesses may hand over the related information and documents to ACCCIM as we would be happy to assist in resolving problems encountered.
Ladies and Gentlemen,
Mr. Koong Lin Loong will brief us on the outcome of the ACCCIM SME Taxation Survey 2016. I wish to express my gratitude to those who have participated and contributed their inputs to this survey as well as cooperation rendered by various trade associations.