Malaysia can meet fiscal deficit target even after GST is removed

Alliance Investment Bank chief economist Manokaran Mottain (pic) told StarBiz that the last paragraph in the monetary policy statement was a hint of what could be ahead.

PETALING JAYA: The audacious move by the Pakatan Harapan government to abolish the goods and services tax (GST) may not necessarily derail Malaysia from its fiscal deficit target, as feared by many economic pundits.

While credit rating agency Moody’s described the removal of the consumption tax regime as “credit negative”, several economists expect Malaysia to remain largely on track of its fiscal deficit target, provided the government fulfils its election promises for reforms in national expenditure.