KUALA LUMPUR: Dewan Negara today passed five bills related to the implementation of the Sales and Service Tax (SST), which is set to take effect on Sept 1.
These are the Sales Tax Bill 2018, Service Tax Bill 2018, Goods and Services Tax (Repeal) Bill 2018, Customs (Amendment) Bill 2018 and Free Zones (Amendment) Bill 2018.
The Sales Tax Bill 2018 was the first Bill passed after a second reading by Finance Minister Lim Guan Eng.
It was approved without amendment after a majority voice vote.
There were 29 Barisan Nasional (BN) and three Pas senators, out of 55 in Dewan Negara.
The approval of the Bill belies the claim that BN senators would attempt to sabotage the government‘s effort to implement SST on Sept 1.
During the winding-up of the Sales Tax Bill 2018 debate, Lim said the implementation of SST was intended to ensure the wellbeing of the people.
“Although it is undeniable that GST is more efficient and transparent, it collects more tax. The B40 are those who suffered because of GST. Previously, they did not have to pay tax, but because of GST they had to pay tax.
“We received many complaints, not only from the Peninsula, but also from Sabah and Sarawak.
“I did not say that SST will lower the prices of goods. The prices of goods may rise, but the effect might be lighter than GST.”
Lim said he did not dare to make predictions, unlike the previous deputy finance minister who had said that the prices of goods would fall with the implementation of GST.
“It was just a theory and it did not happen,” Lim said.
While winding-up the debate on the Service Tax Bill 2018, Lim said only 43.5 per cent of services would be subjected to the Sales and Service Tax (SST) starting Sept 1, compared with 65 per cent of services under the Goods and Services Tax (GST).
He said the number of goods and services that were not subjected to SST was 5,443, compared with 545 under GST.
He said the improvements made to the tax system included setting the sales threshold for service tax registration at RM500,000 annually.
Lim said SST was imposed on restaurants with an annual turnover of RM1 million.
He said a complete list of services that were subjected to tax could be viewed in the Royal Malaysian Customs Department website.