GST caused some companies to close shop, says minister

Nabihah Hamid

SOME companies have shut down because of the goods and services tax (GST), says Second Finance Minister Johari Abdul Ghani.

Johari did not disclose details as the matter is still under investigation.

“Some are respectable (companies), this is one of the reasons we cannot disclose. But many excuses were given some said they are old. Don’t want to do business. Create new companies.

“So there is a legal issue. So what do we do (close company) but we have to investigate,” Johari said in reply to a supplement question from Hasan Arifin (BN-Rompin) in Parliament today.

Hasan had asked whether companies have folded after the abolition of the sales and services tax (SST) and implementation of the GST.

The Malay Chamber of Commerce Malaysia told The Malaysian Insight on October 20 that GST has caused many Malay businesses to close shop.

Its vice-president, Norsyahrin Hamidon, said the chamber has yet to obtain the exact number of members who had to close shop due to GST.

Johari, however, qualified the statment and said these companies did not shut down due to GST alone.

“We have to look at the details when it comes to this company closure issue. Many companies that come to my service centre had to close shop due to competition.

“For example, because tudung made in Indonesia is cheaper, many entrepreneurs are sending it to be sewn in Indonesia.

“Secondly, where there is competition also depends on the volume of your business. If want to give excuse that the company closed shop due to GST, that is not right,” Johari said when answering another supplementary question from Dr Mariah Mahmud (PAS-Kota Raja).

The Royal Malaysian Customs Department reported that it collected RM41.2 billion in GST last year – higher than the RM39 billion target set.

Johari said many companies that were not paying SST had registered with the department after the implementation of the GST.

“That’s why we’re collecting more taxes,” he said. – November 13, 2017.

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  • " ....... Malay businesses to close shop....." ....... and need not pay back loans (eg MARA)......easy ....... let taxpayers pay ....

    Posted 6 years ago by Malaysian First · Reply