3 % GST to replace 6 % SST, senator urges

Lau debating National Budget 2021 in the Upper House today (Dec 21, 2020).

By Lian Cheng

KUCHING, Dec 21: Senator Robert Lau believes that the federal government will eventually need to replace the present Sales and Service Tax (SST) with the Goods and Service Tax (GST) albeit lowered to three per cent.

In his debate on National Budget 2021 in the Upper House today, Lau raised concerns over the increasing national debt caused by the Covid-19 pandemic.

“I am not advocating for the immediate return of GST in replacement of SST but I am for the planning of an eventual replacement of SST with GST.

“The Finance Ministry and the government can and should start looking into this and plan for the eventual implementation. Maybe we start with three per cent instead of six per cent.


“And the implementing agency should be the Inland Revenue Board instead of Customs in order to avoid all the delays in the refund and other hiccups during the implementation stage,” proposed Lau.

He said Malaysia is running a bigger deficit and that is understandable in view of the Covid-19 outbreak but the time will come when Malaysians will need to face the issue of the deficit and public debt.

“Debt service charges are RM38 billion, which is 12.1 per cent of the total federal government for budget 2021. This does not take into account the payment of the principal sum owing. What is the plan to reduce this deficit and debt? How realistic is the plan?

“As in all cases when faced with deficit, there are only three ways — increase revenue, reduce expenditure or the combination of both,” said Lau. — DayakDaily