Thursday, December 17, 2009

4% GST to come into effect in middle of 2011

The 4% Goods and Services Tax (GST) is expected to be implemented by the middle of 2011. The GST Bill was tabled for first reading in Parliament by Finance Minister II Datuk Seri Ahmad Husni Hanadzlah yesterday. He told the house that the second reading of the Bill was scheduled for March next year. Speaking to reporters at the Parliament lobby later, Husni said the GST would be a win-win situation for all, as the Government would receive an additional RM1bn in revenue for the first year while the business and export sectors would save RM4.1bn and RM1.4bn, respectively. “The Government is proposing GST at a rate lower than the (current) sales and services tax rates, and to allow certain exemptions from GST, especially on essential goods such as padi, vegetables, basic food (rice, sugar, flour, cooking oil), fish, meat and chicken, to ensure it will not burden the rakyat, especially the lower income group. The sales and services tax will be abolished and replaced with GST,” he said.

GST %:
4%(2011) -> 4.5%(2013) ----> 7%(2020)----> 15%(2040)

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