GST only removes tax burden on ‘wealthier’ minority, says Pua

By Shazwan Mustafa Kamal
June 25, 2011 | The Malaysian Insider

KUALA LUMPUR, June 25 — Implementing the Goods and Services Tax (GST) while reducing the existing income tax will only benefit the “wealthier” minority, says Tony Pua.

The DAP national publicity secretary said that currently only 15 per cent of the working population earned enough to qualify to pay taxes, which meant 85 per cent of the country’s workforce earned less than RM3,000 a month.

“What the BN government is proposing to do is to reduce the taxes paid by the wealthier 15 per cent of the working population, and redistributing the tax burden to the 85 per cent who currently do not earn enough to qualify to pay taxes.

“The irony is that now the government is arguing that by taxing the rich less, taxing the poor more, they will be able to source increased funds to support the poor,” Pua (picture) said in a statement today.

His remarks today were in response to a statement by Pemandu CEO Datuk Seri Idris Jala, where the latter said that the GST could help widen the government’s tax base and provide funds for the poor now reeling from a global rise in commodity prices.

Pua charged that Jala’s remarks were “completely perverse in its logic,” stating that the proper way to increase the country’s income tax base was to implement policies funded by oil and gas windfall profits.

“Such policies will include drastically improving the quality of education as well as setting a reasonable minimum wage… Once the income levels of Malaysians increase, automatically, based on existing tax structures, more Malaysians will be paying taxes and the government will be able to ‘broaden’ its tax base without burdening the poor,” he said.

He also said the government needed to implement competitive policies, competitive auctions for state land to maximise revenue, competitive tenders for all privatisation and procurement projects to minimise cost and reduce leakages through wastage, rent-seeking and corruption.

  1. No comments yet.

You must be logged in to post a comment.