The Malaysian Government on April 1 begins imposing a 6 percent
Goods and Service Tax (GST) as part of efforts to improve the nation’s
tax management system and fiscal deficit.
The GST is expected to
help reduce the country’s fiscal deficit to 3.2 percent of gross
domestic product (GDP) this year from 3.5 percent in 2014. In addition,
an estimated 22 billion ringgit (6 billion USD) will be raised each year
from GST revenue.
A number of commodities enjoying GST
exemption were also introduced, including essential food products,
health care and educational services and public transportation.
The Government also prepared a specific mechanism to protect consumers from swindlers after the GST is imposed.
With
this move, Malaysia becomes one among over 160 countries in the world
and 7 in Southeast Asia levying a goods and services tax. The country’s
six percent GST is the lowest level among Southeast Asian countries.-VNA