DAP: No sense gaining RM1b from GST to lose RM28b to graft

By Clara Chooi | The Malaysian Insider

IPOH, Nov 29 – DAP has urged the Federal Government to reconsider the proposed 4 per cent Goods and Services Tax (GST), claiming it would do nothing to narrow the nation’s current deficit budget and would only further burden the poor and the middle class.

Party secretary-general Lim Guan Eng said that the Government should, instead, concentrate on fighting corruption and realising savings of at least RM28bil annually instead of a mere RM1bil in additional revenue from GST.

“This RM28bil was admitted by Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah as the cost of leakages from having closed tenders in government procurement or just failing to have open tenders for government contracts in an open manner.

“If the government focuses on changing this, there is no need to impose GST on the people to raise funds.

“But unfortunately, the Barisan Nasional is not brave enough to truly fight corruption,” he said in his opening address at the Perak DAP’sn 15th annual convention here today.

In fact, Lim pointed out the supposed RM28bil in losses to corruption annually may even be an under-reported figure.

“As Time Magazine had quoted Daniel Lian, a Southeast Asia economist at Morgan Stanley in Singapore, saying that Malaysia might have lost as much as US$100bil since the early 1980s to corruption,” he said.

Lim said that the proposed 4 per cent GST, which is set to be tabled in Parliament early next year, would not widen the tax base much, seeing as the present budget deficit was over RM50bil.

“So what is an additional income of RM1bil annually? In fact, this GST would only serve to affect 85 per cent of the working population who currently do not pay taxes because their incomes are below taxable levels.

“The impact would be most severely felt on the 38 per cent of the 5.6 million households with income levels of less than RM2,000 monthly or 2.12 million households,” he said.

Lim also voiced disappointment over the “unconditional support” for “Umno’s GST” by MCA Gerakan, SUPP and MIC.

“No MCA minister has defended public interest but has continued to perpetuate this national economic divide by burdening the poor and the middle-class instead of fighting corruption to get more money. Why fear fighting corruption so much?” he said.

Lim also called for the withdrawal of the 15 per cent preferential income tax rates given to professionals in selected areas on the Iskandar Development Region, saying that the benefit should be offered to all professionals in Malaysia.

“Why is it that professionals in other states have to pay 26 per cent? How can there be 1 Malaysia when we have one country and two systems with double standards and discrimination in tax treatment?” he questioned.

  1. #1 by OrangRojak on Monday, 30 November 2009 - 5:36 pm

    I think the cart may be being put before the horse. GSTs or VATs vary massively from country to country, with greater or lesser effect on lower income households. It’s entirely within the realms of possibility that there would be no effect at all on lower-income households, depending on what goods the tax is applied, and what goods are exempted.

    Yes, it’s preposterous that a government steals and wastes tens of billions of RM and then pretends to be able to make up for it by playing with tax rules, but it’s by no means given that a GST would be necessarily a bad thing. I think there are enough obscenely wrong issues to campaign on without painting as a bogeyman something that is a perfectly innocuous feature of public finance in other parts of the world.

    I feel as though you’re confusing the issue by constructing an argument with both GST and corruption in – they’re not at all related.

  2. #2 by monsterball on Monday, 30 November 2009 - 6:07 pm

    It is always ideas.. how to cover…dirt ..dust and worms exposed and found in the UMNO government.
    They are a proven lot of corrupted to the core…people.
    Govt. must do their best ..and the best is keep sucking our blood to keep them alive.

  3. #3 by frankyapp on Monday, 30 November 2009 - 6:16 pm

    There you go again,this umno guys know no bound to squeezing the poor rakyat high and dry openly through the GST and same time reaping billions of ringgit through the no tender system for themselves and cronies.Days and nights,these greedy guys keep cheating the ordinary malays folks and others using the NEP as a disguised .These mega greedy guys have no option for limit to achieve their greediness.They always think of their own pockets,care not a darm for their own race and religion and country. Thousands of billion have been unscrupulously squandered and siphoned off to foreign lands since 1957 and yet these guys want more . These umnoputras and warlords have no ears to listen ,no eyes to see,no simpathy for the rakyat except know how to squeeze,cheat and rob the rakyat,using what ever it takes .You cannot ask corruptors to fight corruption,the rakyat is the only hope to fight it by finishing off Umno/Bn in the 13 GE. This’s the only choice.

  4. #4 by ENDANGERED HORNBILL on Monday, 30 November 2009 - 6:40 pm

    Hello, YAB Datuk Seri Najib – apo ni “Rakyat Utama (People First), Performance Now” shibboleth?

    Aiyoh, sudah banyak cakap tak serupa bikin. Lebih bagus balik Pekan-lah.

    How can in the mdst of worldwide recession and a wavering 2010, u want to impose more hardship on the people! I suggest u beli less Scorpene. Nobody is planning to attack Malaysia, no maintenance cost and personnel cost and cut down 28billiun leakage – that is the first preliminary answer to Malaysian economic recovery.

  5. #5 by ENDANGERED HORNBILL on Monday, 30 November 2009 - 6:48 pm

    “I cannot advise him (Datuk Nik Abdul Aziz Nik Mat) because he is more knowledgeable than me (concerning Islam).

    For all unbelievers, it’s time to get nervous if u think u can sow wild oats and plunder the nation’s wealth whilst God’s people starve and go crying. God is not mocked. He hears his people’s prayers and that includes ToK Guru Nik Aziz. U think u can outsmart God…yo, ho, ho…..keep trying..go ahead, PM, DPM, keep going on, keep trying….yo, ho, ho.

    God is in the heavens, u r on earth. And if he so much as sneezes, u will all be under the earth, tsunami or no tsunami. Just a sneeze…no more is needed.

    So wake up PM, TPM and get right and honest with yr God. Thank u Tok Guru for speaking out what is common spiritual truth.

  6. #6 by cheng on on Monday, 30 November 2009 - 10:23 pm

    Collect 28 years of GST,and wasted in a year due to graft.????

  7. #7 by pwcheng on Monday, 30 November 2009 - 11:31 pm

    1)The 1Malaysia cry of UMNO rings hollow.
    2)People first performance now says UMNO cow.

    The BTN, an UMNO juggernaut proves point 1
    The GST will not be people friendly so Najib’s point 2 is flawed.

    From day 1 I never believe in all the tattered slogan by UMNO. Just forget about their 1Malaysia. But 1 thing, we must stand as 1 to throw them out once and for all.

  8. #8 by boh-liao on Tuesday, 1 December 2009 - 9:16 am

    LGT obviously a bit slow in understanding how Umnoputras n BN ppl plan 2 jiak besar
    Of cos, corruption will continue n duit masuk n sent 2 London by money changers
    More players coming in 2 ciak
    Previously MMK n AAB’s mah chai dah jiak n may still jiak
    Now a new grp of parasites, NR n RM’s mah chai, want in too
    D pie must get bigger, otherwise many cukup
    Wonderful GST will bring in additional RM1bil 4 new parasites
    Happy time is here again, jiak, jiak, jiak kau kau b4 d next GE

  9. #9 by boh-liao on Tuesday, 1 December 2009 - 9:17 am

    Oooooooops, LGT shd be LGE

  10. #10 by taiking on Tuesday, 1 December 2009 - 9:36 am

    Isnt GST a tax on sales? It does not matter whether the sales concerned goods or services. In other words, the GST scheme is all encompassing. It catches everthing except those exempted by law – sales of used items/goods and loans are two examples of exemption (I think). The original idea of taxation was to squeeze the rich to benefit the poor – very robin hood like. Now, taxation is tagged to economic activities instead; and to the tax people, sales must a convenient tagging point. The whole idea of taxation has changed. Robin hood will be retrenched soon! Poor people would be paying taxes just like everyone else and by the same amount (in terms of gst rate). Yes other countries have it too. Perhaps that was because they are ready for tax on sales. Are we?

  11. #11 by tenaciousB on Tuesday, 1 December 2009 - 11:55 am

    BN has emptied their treasury with all the billions of bribing, unethical money based state take-overs, contructions projects wastages, filling up the pockets of their ministers with millions to squander on overseas mansions, holidays and so on and so on.

    So now, how can they spend more when there’s nothing left, introduce GST,another billion of people’s money to spend. LOL

    Better get a military coup and dethrone BN before they finally sell the country to indonesia for more money.

  12. #12 by OrangRojak on Tuesday, 1 December 2009 - 12:39 pm

    taiking: “the GST scheme is all encompassing. It catches everthing except those exempted by law
    Adoi… where did I put the “everything – except” rifle? You learned that from Najib! “Everything will be open tender … except when it isn’t”. In a sensible country, where people don’t listen to the first three words of a sentence before jumping on their kopithiam tables and tearing at their flies to get their points of view out, the newspapers / websites would be publishing their ‘models’ of how they expected various forms of tax changes to affect different ‘representative’ citizens. Where are they?

    Do we know what will be taxed, what won’t, and how much? TMI published an article recently that said “only ten percent of workforce taxed”. Does that mean 90% of tax force is too poor to tax? I don’t think it can. As ever, the hardest part of making any decision in Malaysia is that all the facts are either missing or we don’t trust the publisher.

    It’s perfectly reasonable to believe that a GST – on jewel-encrusted tassels for Blackberries only – would not have a great effect on people who eat only leftovers from restaurant bins. Before I go out and buy some wood, cardboard and marker pens, I want to know exactly why I should believe the GST is a bad thing before I’m to join a protest against it. Many countries have equivalents to the GST without undue upset. Why should it be a dirty word in Malaysia?

  13. #13 by Godfather on Tuesday, 1 December 2009 - 1:08 pm

    “….but it’s by no means given that a GST would be necessarily a bad thing…” Rojakman

    Yes, GST and corruption are two separate things, but they both deal with one commonality – government spending or rather the need for government to raise money to fund the ever widening budget deficits. Najis has promised to reduce deficit spending to around 5 pct in a few years, and the imposition of GST is one way to raise funds for public expenditure. However, we know that public expenditure has massive leakages – as admitted by Husni and by the MACC in the case of Sarawak. Instead of introducing GST as a source of funds, why not concentrate on reducing leakages where we could even talk about income tax reductions ?

    It’s OK not to protest against GST imposition, Rojakman. We just want you to protest against leakages.

  14. #14 by artemisios on Tuesday, 1 December 2009 - 1:40 pm

    one scheme after another to juice the people dry.
    ESPECIALLY the middle income & the poor… just because they’re too poor to fight back. That’s just disgusting.

    Petrol prices, land scams, closed tenders, credit card taxes, GST,

    When is this going to stop??

  15. #15 by k1980 on Tuesday, 1 December 2009 - 1:55 pm

    najid is like a village idiot adrift in a leaking boat. Instead of removing his sarung and plugging the leak with it, he chooses to bail out the water seeping in with his hands.

  16. #16 by OrangRojak on Tuesday, 1 December 2009 - 2:23 pm

    protest against leakages
    Did Hanadzlah give any more detail? It seems … remarkable … that an UMNO member should present a fact like that in the cold light of day. Does have a licence to provide counter-unity facts?

  17. #17 by Godfather on Tuesday, 1 December 2009 - 3:19 pm

    It is equally remarkable that a senior MACC official would go public with the revelation that 60 sen out of every ringgit spent on infrastructure in Sarawak could not be traced. Simply vanished.

    However, the most remarkable statement of all came from the Deputy Chief Minister who basically said that he was pleased with the statement of the MACC and that he hoped that the MACC would act fearlessly on this matter. If you don’t already know, George Chan’s daughter married the eldest son of the Chief Minister. One big happy family responsible for most of the leakages.

  18. #18 by johnnypok on Tuesday, 1 December 2009 - 3:30 pm

    Learn all you can from great Singapore, otherwise the whole nation will go bankrupt soon.

  19. #19 by Godfather on Tuesday, 1 December 2009 - 3:37 pm

    Bolehland is unique in that billions and billions of public funds could simply vanish and no perpetrators caught. The politicians acknowledge it, the bureaucrats acknowledge it, and then they all shrug their shoulders. And at each election, the rakyat votes them back in again.

  20. #20 by trublumsian on Tuesday, 1 December 2009 - 4:19 pm

    well, mr. rojak, gst in itself is not a bad or good thing. countries do implement it to fund public projects. most states in america have it, and have it at rates malaysians will cry murder at. california’s sales tax is currently averaging 9%, but people aren’t yellling and kicking because every penny of it goes to public coffers for general good. you have got to be kidding if you don’t know why umno wants a gst. just the timing is a dead give-away.

  21. #21 by taiking on Tuesday, 1 December 2009 - 4:25 pm

    Dear Godfather,

    Dont you know that they are busy going after desperate single mothers who stole from supermarkets to feed their kids, illegal street-side hawkers and other such like activities.

    Come on. When we talk about umno, we must re-tune our sense of priority. Otherwise we would make no sense to them. Remember this always. We do not have masters-in-btn. They do.

  22. #22 by ktteokt on Tuesday, 1 December 2009 - 5:05 pm

    Nothing suprising! Still remember the “WHITE RICE FOR SWEET POTATO” incident?

  23. #23 by Winston on Tuesday, 1 December 2009 - 6:49 pm

    The government wants to raise taxes by GST,right?
    Now, on the other hand, our tax money is completely squandered by grandiose wastage by the BN government!
    Leakages here, leakages there, leakages everywhere!
    While Malaysians are desperately seeking funding for health care, know what our Dear Leaders do?
    Spent RM100 million on Tak Nak, Rm10 million on space flight and RM 20 million on image facelift.
    Besides, there obviously are many other similar instances.
    Yes, foreign countries also have GST but their government USE THE MONEY FOR THE BENEFIT OF THE TAXPAYERS!!
    Perhaps someone can shed some light on it!

  24. #24 by chengho on Friday, 4 December 2009 - 9:19 am

    many expat from Europe , USA , Australia, Korea and Japan coming to work and live in Malaysia….

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