Khairy: Don't scrap GST because of politics

PETALING JAYA: Rembau MP Khairy Jamaluddin has urged the government not to scrape the Goods and Services Tax (GST) because of politics.

In a tweet on Tuesday (July 17), Khairy said that the GST is more efficient than reverting to the Sales and Services Tax (SST).

"Am aware GST is big political issue for govt (sic) but they must approach the issue rationally. Don’t scrap GST because of politics," he said. 

"Adjust the rate so it's revenue neutral to your SST. Don’t let politics determine economic policy," Khairy added.

Khairy said instead of SST, the government should keep GST, but at a lower rate that will effectively give the same revenue as 10%+5% SST.

"(GST) could be set at 3-4%. SST is inefficient with many leakages," the Umno lawmaker said.

Khairy also said he would raise the matter during the debate session in the Dewan Rakyat tomorrow.

Meanwhile, Finance Minister Lim Guan Eng announced on Tuesday (July 17) that the provision of services will be taxed at 6%, while the sale of goods will incur a 10% tax.

He said that the SST would be implemented on Sept 1 after the necessary laws are passed in the current Parliament session.