THE luxury goods tax announced in Budget 2023 is not an alternative to the goods and services tax (GST), said Deputy Finance Minister II Steven Sim Chee Keong. 

He said the ministry is refining the system and studying several aspects of it, such as the tax structure and the rates to be imposed.

“We are also studying the tax system – whether to introduce a new tax or widen the scope of the existing system,” he said in his wind-up during the Supply Bill 2023 debate in the Dewan Negara.

The Finance Ministry is gathering feedback from sessions with stakeholders, such as manufacturers, retailers, and tourism industry players on the luxury goods tax, he said. 

Sim said the government has not decided on introducing the GST because a change in tax policy will have a big impact on the economy and the cost of living. 

“This is not an appropriate time to reintroduce the GST as the people are struggling with the cost of living post-pandemic,” he said.

On Budget 2023, the deputy minister said the government is looking into targeted aid for needy communities.

“Budget 2023 will support the M40 group, which has been badly affected for more than two years due to the pandemic, with their income having dropped more than 50%. 

“The budget will also help micro, small, and medium enterprises,” he said. 

The Supply Bill 2023 was passed by the Dewan Negara today without amendments and with a majority voice vote. – Bernama, April 5, 2023.