Sunday, January 29, 2017

Mahathir repeals GST just like BR1M?

MM Online - Economists rebuff Dr M’s pledge to repeal GST


Tidak, berita atas bohong
saya tidak sebut nak hentikan BR1M

sebenarnya kerajaan saya akan jamin BR1M khas untuk pribumi

KUALA LUMPUR, Jan 28 — Economists have warned against Tun Dr Mahathir Mohamad’s plan to abolish the Goods and Services Tax in the event Pakatan Harapan wins federal power, saying such a move would paint Malaysia as regressing on needed fiscal reforms.

Firdaos Rosli, a fellow of Economics at the Institute of Strategic International Studies (ISIS) Malaysia, went as far as saying it was “preposterous” to entertain the idea of abolishing the GST when the Budget deficit was again widening.

“I don’t think anyone in their right mind would want to do that. Maybe we should ask him (Dr Mahathir) what is he going to do with the economy when you are short by RM40 billion in revenue?” Firdaus told Malay Mail Online.


The consumption tax was among the measures that ratings firms had pressed Malaysia to adopt in order to diversify its revenue stream that had once been heavily dependent on petroleum income. [...]

“Having a robust indirect tax system such as the GST also means that the economy is not going to suffer badly when there is a shortfall in direct tax such as corporate tax and income tax during an economic crisis. Kind of like a buffer,” Firdaos said.

Asian Development Bank’s (ADB) Dr Jayant Menon held similar views against repealing the consumption tax, saying it would be detrimental to the government’s efforts to control its fiscal deficit.

GST is already a principal taxation mode in more than 160 countries including Australia, New Zealand, Singapore, UK (Britain), etc because it simplifies taxation on goods to only one single tax instead of multiple layers of taxes.

If correctly monitored, maintained and enforced it is the fairest form of taxation - anyone uses it, he or she pays taxes for it. In Malaysia it's 6%, while in other nations it is higher (10% in OZ, 15% in NZ and 20% in UK).

Don't conflate removal of government subsidy for oil as GST. They are different. GST is just replacing other forms of taxes while government subsidies like pocket money, when removed, will naturally see a rise in prices or some loss to the pocket.

Some portion of the GST collected should be returned to state governments as state revenue, and not kept just by the federal government. That's what is being done in OZ though richer states like New South Wales (NSW) and Victoria (Vic) have complained that their share of GST have gone to states like Western Australia (WA).

I personally and professionally support GST where every consumer pays. As for government subsidies, which is an entirely different issue, we need a separate post to avoid mistaking one for another.


Many in Malaysia might have misunderstood GST as an additional tax on top of the various taxes on goods employed previously. It is NOT.

In the Australian example which I presumed Malaysia's would more or less be similar to, the GST is meant to REPLACE (not add on to) those already-existing multi-layered taxes to make simpler the overall tax on goods and services.

In Australia, a 10% GST is imposed on goods like furniture, motorcars, clothing, processed food etc , and 'services' like car repairs, doctor services, char-kuat (massage, wakakaka), haircuts, plumbing or electrical works, etc.


Now tell me, what are your views on GST?

Errrr ... I'll tell you after you let go of me


wakakaka 

By the way, it does not replace income tax which is a separate tax altogether, which taxes one's income or revenue.

GST is a consumption tax. You 'consume' certain goods and services, you pay 6% tax in Malaysia, 10% in Australia, 15% in NZ and 20% in UK.

With GST, most things should become cheaper while some will be dearer.

How can it be cheaper, you may ask? Because GST replaces the existing taxes on the goods. Goods that had government taxes levied on it prior to GST should have been removed, thus making the goods either cheaper or at worst, the same price.

For example, if a product was previously taxed at or to a total of 10% then that product would become cheaper (by 4%) because it's now taxed by GST at only 6%. Some products which were previously not taxed at all would of course become dearer, by 6%.

And some goods are NOT subjected to GST, like most fresh food.

I wonder how much was 'white goods' (eg. fridge, washing machine, air-conditioner, microwave oven, western style stoves and ovens, etc) taxed at previously, ie. prior to GST?

One of the hypocritical or bizarre moronic outcome of our toxic politics is some Chinese taking an anti-GST stand, when the GST actually mitigates (solves) one of their age-long complaints, namely, that they (the Chinese) alone have been bearing most of the taxes in Malaysia.

To understand what I mean, please read my July 2013 post Food for thought (1) - GST. Bodoh punya Cina!


Chinese against GST

So don't listen to Mahathir. He talks cock on GST as he previously talked cock on BR1M which he now embraces so tightly you would think he personally conceptualised and implemented it.

That's the usual bullshit sprouted by Mahathir.

If his son gets into government as the PM of his Pribumi controlled Malaysia, dear Mukhriz will retain the GST on the advice of daddy Emperor Imperial and who knows, may even raise it from 6%. Additional revenue for Forex entertainment or build another Arabian-night Putrajaya No 2?

I won't be surprised if a new government under Mahathir may even re-categorise BR1M as exclusively for his pribumis and placed it under the NEP program which means the nons won't get it. He is that type of person.

As the experts (economists) say, Malaysia cannot do without the GST. The 'failed state' that you warned about will materialise if Mahathir removes the GST. 

But he won't; he only talks cock now, but will shaft you gullible hopefuls later when and if he gets back into power.


14 comments:

  1. 1. gst in malaysia is screwed up. mana ada harga barang2 yg turun. hanya ayer hujan & susu getah saja selalu turun.
    2. mentioned this before abt the fed gomen yearly belanjawan. the 'must have' and 'nice to have' expenditures, do away with the latter such as btn, plkn, permata, etc and ensure the are no top-ups prices for the former such as military & police equipment.
    3. cm guan eng said many times that the plus highway toll will be discontinued if pakatan controlled putrajaya. then how about the maintenance?. kalau dia kata akan dikurangkan kadar toll, boleh dengar la. plus highway is similar to e.g. cellular phone subscribers, bila guna, kena bayar, kerana diberi pilihan guna trunk roads. what say you anhea?

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  2. Agreed that GST works well in more than 160 countries.

    If it is properly implemented it is very useful to the economy, especially, when there is not much scope to reduce expenses in order to cope with growth and development.

    But the road to GST implementation is fraught with many difficulties. One example, there is a complication because of "Goods that had government taxes levied on it prior to GST should have been removed, thus making the goods either cheaper or at WORST, the same price" (now generally at higher price + 6%)?  So, who suffers?

    Most importantly, IF, the implementation of GST  does not generally reduce costs, promote growth, development and employment, but instead results in increase sufferings of the masses due to its improper administration, then GST should be abolished.

    Is there GST in USA?

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  3. dap especially lge said the same for many months, or years, do u think he cheat us like mahathir did?

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    Replies
    1. I know pkr has and still is, wakakaka

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  4. Unfortunately u can ONLY see GST as it happens in matured economies like Oz, NZ etc.

    Thus u conveniently presume that the bolihland GST should work like such!

    How long can u be!!!

    Perhaps it's bcoz u r not trained in accounting or economic. But then it's no excuses for u to jerk off & made very irresponsible comments about what u think of GST in general & what GST as it happens in bolihland.

    Let's give u a lead.

    Many taxes in bolihland hide behind APs (approved permits).

    Many essential items need APs, partly to give dedak to cronies, partly to disguise the tax. In fact there might be multiple APs required just for one single item!

    With the introduction of GST, suddenly all these essentials need to cost more bcoz of that additional GST while the AP still remains!

    So don't just believe what those experts (economists) tell u. They r just comment in general, either, like u they don't know the real story of consumptional tax structure in bolihland or in the case of local they r poorly trained on top of been trying hard to be political-correct in the eye of the jibby regime!!!!

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    Replies
    1. CK, if it's the implementation that's the problem, then we should deal with the implementation process, not the gst itself. the gst is good for malaysia

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    2. So, u think that's due to implementation?¿??

      How about out right robbery for the B40 who dont qualified to pay in the 1st place as mentioned by HT Low.

      Tax all who consume w/o 1st asking who consume what & why?

      GST is a simplified consumption tax that needs pre-qualifications. & most of the time these pre-qualifications ONLY can be found in matured economies.

      I think u should spend yr writing in promoting ROBERT B. REICH proposal to tax the super rich.

      This world is NOT a fair playing field as indicated by the fact that the Top eight richest men worth more than HALF of the world's population!!!

      Such dichotomy is even more prevailing in bolihland.

      The fact of top 2% of the ASB owns 95% of the deposit tells u what?

      Similarly, top 5% of TH fund contributors own 97% of the fund!

      Both these ASM & TH contributors r there JUST bcoz of the make-believe super dividend returns as compare to the token commercial bank interest!

      Just ask yrself r these fund helping the poor or the super rich???

      Again, implementation fraud??? How about Robin Hood in reverse? Using the blur-sotongs' ignorance to enrich the selected elites?

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  5. Whilst generally speaking, you are correct that GST is a simpler system of taxation, a good replacement for multiple taxes, it is a regressive taxation system. The impact on the poor (who had never paid taxes before due to being outside the threshold) is much harder than the rich. In addition, those few GST Ringgits paid by the poor means a lot more than those Ringgits paid by the wealthy.

    I will agree to the introduction of GST when the poor has reached a reasonable living standard level, not while they are still on a hand-to-mouth existence. I do feel sorry for the kampong folks especially.or its introduction.

    GST brings into the taxation net

    ReplyDelete
    Replies
    1. that is assuming the goods were not taxed previously. if those were, it's possible their prices remain the same or even cheaper. fresh uncooked foodstuff such as Azmin Ali's lobsters, veg etc remain untaxed. in reality, as I experienced in Australia, one doesn't notice the difference before and after gst. it's politicians who stir shit like batu api's in their own interests. I doubt Mahathir's campaign promise. He will get tax revenue one way or another

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  6. there is gst in Indonesia, thailand etc... sometime it is known as value added tax or VAT inshort.

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  7. The Chinese have become heavily against GST because the ACTUAL implementation in Malaysia (not theoretical Ivory Tower theories) has been highly detrimental to Chinese small businesses in particular.

    The inevitable final selling price increases have had a substantial dampening effect on consumer demand. 6% does not sound much , but many lower and middle income families had already been living on marginal budgets previously, so the additional expenditure forces them to reduce consumption further.
    As a percentage of disposable income, the burden of GST falls disproportionately heavier on lower and middle income families than the rich.

    Chinese small businesses have borne the brunt of Kastam DiRaja Malaysia's deliberate placing of obstacles against the businesses claiming their input tax, which ought to be an automatic right in a proper GST system.
    Kastam DiRaja is triggering full scale GST audits the moment a small business make an input GST tax claim. There is a "Cari Makan" element to this.

    There is anecdotal evidence Chinese small businesses are being deliberately targeted.

    When small businesses cannot or are only able to claim back Input Tax with extreme difficulty, prices rises are inevitable. Otherwise they go out of business.

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  8. If all you can comment on is Australian GST implementation, stay the Fuck back in Australia.

    Proper GST implementation is NOT what is happening in Malaysia.

    Najis poodle defending him at every juncture...Podah !

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    Replies
    1. you lack fair judgement for the good of Malaysia, and are prepared to throw the baby out with the bathwater just to satisfy your political prejudice

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    2. I think u should eat yr words, as u have written above!!

      Theory is an ivory tower product, deplecting of real situation elements. Real live implementation has to be in tune with these elements in order to be practical.

      Using a set of theoretical matrices, vis-a-vis as practiced in advanced economies, to judge the implementation of GST in M'sia is HIGHLY immoral!

      So, if the l'tle neapoleans manipulating these matrices to hijack the GST, then one should ask WHY gave them these tool in the first place.

      Many advanced economies r facing the similar problems in implementing GST/VAT on the early stsges. But they MANANGE to tweak the implementation to lessen the impacts, no thanks to their well-placed legal structure & high civil moral standards.

      But, for u to expect the same in bolihland, shows how naive & remote from the real situation in the country.

      Life must be good, too good in fact in Oz, for u to be able to even sense the helplessness of M'sians as described by Monsterball!

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