PETALING JAYA: Prime Minister Datuk Seri Anwar Ibrahim today said that Malaysia needs more time before reintroducing the Goods and Services Tax (GST).
Anwar, however, acknowledged that GST is the most transparent and efficient tax system.
"All the big companies want GST. But please remember, I said yes, but let the minimum wage threshold rise first.
"Give it some time to push the economy forward, because implementing GST now means taxing everyone. This is my political philosophy and conscience.
"Is GST efficient? Yes. Is it transparent? Yes. Will the government get more revenue? Yes. But who are you taxing? Everyone. The rich? Yes. The poor? Yes. I can't do that," he said in his speech at the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) 78th Annual General Meeting held today.
Present were Deputy Investment, Trade and Industry Minister Liew Chin Tong, the Chinese Chamber of Commerce and Industry of Kuala Lumpur and Selangor president Datuk Ng Yih Pyng and ACCCIM outgoing president Tan Sri Low Kian Chuan.
Anwar added that countries that have implemented GST first raised their minimum wage level.
"So what is my view? My view is to give it some time, a few years and ensure that the minimum wage threshold, the level of wage increases to RM3,000 or RM4,000 minimum, then we can (gradually) adjust this policy.
"I understand this issue and have studied it for decades. The first time that we talked about GST was when I was the finance minister and what was my statement?
"…(GST) is the most efficient and transparent system that would be advantageous to the government in terms of revenue collection.
"I also said back then, to give some time. Push the economy forward, stop corruption and people taking advantage of the political office," he said, adding the necessity of curbing the rampant corruption of the past to create a fair and equitable economic landscape for Malaysia.
The GST was introduced at six per cent in 2015 under then-prime minister Datuk Seri Najib Razak.
It was abolished by the previous Pakatan Harapan government three years later and replaced with the sales and service tax (SST) at the same rate.
During the tabling of the 2024 Budget, Anwar announced that the SST rate would be increased to eight per cent, with food, beverages, and telecommunications exempted from the hike.