DEPUTY Minister of Finance Steven Sim Chee Keong said the government was not disputing the strengths and weaknesses of the goods and services tax (GST) system but the timing to implement it. 

He said the government’s view is that the country is still in the recovery phase post-pandemic and is facing various global economic challenges due to geopolitical unrest, so in this less-than-encouraging economic situation, it is not ready to implement the GST. 

“It is not a discussion about the strength or weakness of the GST taxation system but the appropriateness of it; we have to do the right thing at the right time. 

“If you do the right thing but at the wrong time, it will put a burden on the people,” he told Dewan Negara today during the winding-up debate on the midterm review of the 12th Malaysia Plan. 

Sim added that the government would consult all stakeholders to look at improving the existing taxation system such as the sales tax and service tax. 

Regarding the introduction of a carbon tax, Sim said any introduction of a new tax needs to be carefully studied to take into account the impact of the tax not only on economic activities in general but also on people’s lives. 

“So, in this aspect, the government currently has no decision to implement a carbon tax, but the Ministry of Finance is conducting a study on the feasibility of a carbon tax as one of the carbon pricing instruments to support the country’s aspirations in achieving a reduction in the intensity of greenhouse gas emissions as announced in the 12th Malaysia Plan,” he said. 

The study includes a benchmarking process identifying best practices applied in developed countries regarding the implementation of the carbon tax, he added. – Bernama, September 25, 2023.