A TOTAL of RM18 billion in goods and services tax (GST) refunds was lost under the previous Barisan Nasional administration, Finance Minister Lim Guan Eng said today.
These funds should have been returned to businesses two weeks after they filed their claims.
“As of May 31, 2018, the total outstanding amount (of refunds) since 2015 is RM19.4 billion.
“From the number, a total of RM9.2 billion is from 2018, RM6.8 billion is from 2017, RM2.8 billion is from 2016 and the remaining RM600 million is from 2015.
“The amount left in the account is RM1.486 billion only. I need to stress that these figures were confirmed after an internal audit conducted by the Customs Department.
“It means the shortfall is RM18 billion,” he said while tabling the GST (Repeal) Bill 2018 for second reading in Dewan Rakyat, today.
The bill is to repeal the GST which was introduced by the Barisan Nasional government in April 2015, to make way for the sales and services tax (SST) that will come into force on September 1.
Today’s revelation follows his claim yesterday that the tax payments had gone into a consolidated fund and the money used by the BN administration.
He said this had let to some companies having to wait for as long as two years for their GST refunds.
He said the outstanding payment was due to the previous government’s cash flow problems caused by lack of fiscal discipline, uncontrolled wastage and huge debts.
“We regret that the outstanding is the result of the previous government’s failure to deposit the GST refunds into the trust account that is reserved to pay GST claims.
“This is a serious financial abuse especially when the spending was used to finance projects by cronies. Since the GST was introduced, the money has been used to cover up problems related to financial scandals, as the people of Malaysia know, GST is the result of 1MDB,” he said, referring to state investment fund 1Malaysia Development Bhd and the multi-billion dollar scandal surrounding it.
He said Pakatan Harapan government would study various ways to raise sufficient funds to resolve the financial problems created by the previous administration.
“It is our moral imperative to pay the GST refunds. This is the people’s and the companies’ money.
Lim said the failure to return the GST refunds had contributed to the increase in prices of goods during the implementation of the tax regime.
“There’s a lot of complaints because companies haven’t been paid back. Some have been forced to close shop.
“The cost was charged to customers and this is the weakness of the (GST) implementation.” – August 8, 2018.
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