KUCHING: Malaysia's introduction of the Goods and Services Tax (GST), although unpopular, was the right decision in view of changing economic circumstances, said Datuk Seri Najib Tun Razak.
The Prime Minister said it would have been easier not to introduce GST, as what appeared to be a new tax — even though it replaced an older one — could seem to be a disruptive.
“We knew it wouldn't be popular. But it would have been irresponsible not to have brought in GST.
“It’s not just that we needed to widen the tax base – which is one reason why over 160 countries around the world have a form of GST – it is also that with the plunge in the price of oil, GST saved us,” he said when opening the 13th World Islamic Economic Forum (WIEF) at the Borneo Convention Centre Kuching on Tuesday.
Najib said those in the Opposition who wanted to get rid of GST were "deceiving the people and deploying fantasy economics".
He said governments and countries in the 21st century could not stand still and carry on doing things the old way.
"Responsible governments must change policies as circumstances change for the well-being of the people.
"If we do not adjust our policies, our nation loses its competitive edge and gets overtaken by other countries. We cannot and must not allow that," he said.
Playing on the forum's theme "Disruptive Change: Impact and Challenges", Najib made a joke about former prime minister Tun Dr Mahathir Mohamad during his salutations.
He was acknowledging the presence of another former prime minister, Tun Abdullah Ahmad Badawi, whom he described as "my very supportive immediate predecessor".
"My other predecessor wants to force disruptive change," he quipped, quickly adding, "but we're not here to talk politics."
Over 2,400 delegates, including 500 from outside Malaysia, are attending the three-day WIEF.