THE hike in the price of goods are caused by other factors and not the Goods and Services Tax (GST), says Deputy Finance Minister Othman Aziz.

In defending the controversial tax that was implemented in 2015, Othman said the government compensated for this by providing financial aid to the people, such as through the 1Malaysia People’s Aid (BR1M).

“We cannot say only GST causes price hikes. We have to remember that the cost of goods is not only based on the tax but also related to currency exchange, fuel prices and other costs.

“We at the ministerial level monitor the increase in the price of goods and if there is any increase, the Barisan Nasional government compensates directly or indirectly through channels such as BR1M, or through aid to small farmers, fishermen, and so on.

“All this (the aid) has balanced the increase in the price of goods so that it will not burden them. So,  price hikes are not due to GST but other components of the hike,” he said in Parliament today.

Othman said this in a reply to an additional question poses by Seremban MP Anthony Loke, who asked him if the Finance Ministry had undertaken a study to see if the GST helped lower the price of goods and if it had a list of any such goods.

Loke said this was because former deputy finance minister Ahmad Maslan had said that the price of goods would decrease with the implementation of GST.

Othman said taxes like the GST has been implemented in more than 160 countries, and that the 6% rate implemented by Malaysia was the lowest among Asean countries.

Until September 30, 454,609 traders were registered with the Customs Department.

Putrajaya has collected RM27.01 billion in 2015 and RM41.21 billion in revenue last year through GST.

Putrajaya also collected RM29.81 billion between January and September this year.

The Malay Chamber of Commerce Malaysia last week said the GST had affected Malay traders and caused many to close shop.

Yesterday, Prime Minister Najib Razak said the GST should not be treated as new tax but part of the upgrading of tax as a whole designed to make Malaysia more competitive, able to control the black and illegal economy and also to reduce the number of tax evaders and expand the core of the national tax. – October 25, 2017.