Government May Impose GST At Four Per Cent, Says Husni

November 26, 2009

KAJANG, Nov 26 (Bernama) -- The government plans to impose goods and services tax (GST) at four per cent, Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah said on Thursday.

"We are replacing the current sales and services tax, which is currently between five and 10 per cent," he told reporters at the Culture, Ideas and Values Workshop organised by the Foundation For the Future at Country Heights Resorts in Kajang.

He said the GST implementation was important for the country's future.

"The revenue source must be sustainable. If we can get sustainable revenue, we can get a good budget," he said.

He said the Consumer Price Index (CPI) would not increase if the GST was implemented.

Selected essentials like rice, sugar, cooking oil, flour and domestic transportation would not be subjected to GST.

Husni said the GST Bill would be tabled for first reading in the current sitting of Parliament and is expected to be tabled for second reading March 2010.

GST would be implemented 18 months after the second reading.

The government expects an additional RM1 billion in annual revenue one year after the GSt is introduced.

To a question on whether the Finance Ministry would establish a task force to investigate unpaid debts of RM500 million owing to 34 Class A Bumiputera contractors by Syarikat Perumahan Negara Bhd (SPNB), Ahmad Husni said:" There is no task force being set-up."

SPNB is a wholly owned subsidiary of the ministry.

"We have given money to them (SPNB) under the stimulus package. What is the need for a task force. This is not something very complex that needs a task force.

"We are confident the board of directors and management will resolve the issue," he said, adding that SPNB has already settled a portion of the outstanding debts with the contractors.

-- BERNAMA