KUALA LUMPUR: Any proposed revisions to the consumption-based tax system, such as reintroducing the Goods and Services Tax (GST), needs careful evaluation to ensure they are progressive and straightforward to implement, do not harm the cost of living or economic growth, and can reliably generate government revenue, the Dewan Rakyat was told today.
Finance Minister II Datuk Seri Amir Hamzah Azizan said the government has no plans to revive the GST, which was abolished in 2018, due to its broad application as a consumption tax.
"At present, it is deemed inappropriate to reintroduce it, especially considering the financial challenges faced by individuals with lower incomes. Therefore, the government will focus on enhancing the current tax system and introducing taxes that do not burden vulnerable populations, before considering the necessity of implementing new consumption taxes such as the goods and services tax," he said, in response to an additional question from Datuk Mohd Suhaimi Abdullah (PN-Langkawi).
Suhaimi had inquired whether the government intends to reintroduce GST.
Meanwhile, to an additional question from Datuk Mohd Isam Mohd Isa (BN-Tampin), Amir Hamzah said the government has no plan to extend the Special Voluntary Disclosure Programme (SVDP) 2.0, which was conducted from June 6 last year to May 31 this year.
"So far, the government does not intend to extend the SVDP 2.0 programme beyond the set period. This timeframe is deemed sufficient to allow taxpayers to report their income or tax liabilities related to sales or service transactions from previous periods.
"Despite not extending SVDP 2.0, both the Inland Revenue Board (IRB) and the Customs Department have devised strategies to enhance tax compliance.
" The SVDP 2.0 under the IRB allowed both new and existing taxpayers to voluntarily report income, asset disposals and the stamping of documents or agreements that have been completed according to specified conditions, while under the Customs Department it included voluntary disclosures for taxes above the liable amount under sales tax, service tax, GST and tourism tax, subject to specific conditions.
Amir Hamzah said during the period (June 6 to May 31), the IRB approved 141,406 voluntary disclosure applications involving 102,572 individual taxpayer cases; 27,707 company cases and the rest involved other categories such as organisations.
"The amount involves a tax assessment of RM1.29 billion. The amount was found to have exceeded the initial target set of RM1 billion. From the total assessment, as much as RM512.6 million has been successfully collected."
The Customs Department, he said, received a total of 1,542 voluntary disclosure applications from individual taxpayers and companies, with the total taxes pledged amounting to RM229 million.
"This amount also exceeded the target expected with 500 applications with a tax collection value of RM200 million."
He said the revenue collected from SVDP 2.0 and other tax revenues collected are channelled to the consolidated fund.
"The fund is then used to finance national expenses approved by Parliament through the annual budget, including public development projects such as schools, universities, hospitals and roads among others."
He said this in response to the initial question from Isam, who inquired about the effectiveness of the SVDP 2.0, as well as the number of companies and individuals who had participated in it and the value of the proceeds collected for the interest and welfare of the people.