PUTRAJAYA: Malaysia is looking at ways to make its tax system more progressive, including whether certain elements of the Goods and Services Tax (GST) can be incorporated into the existing Sales and Services Tax (SST), says Datuk Seri Anwar Ibrahim.
The Prime Minister said SST would remain the basis of the current tax system, but certain GST features could be considered if they improved it.
“We are open to studying ways to improve the tax system.
“But if we are talking about GST alone, my concern, as I have said repeatedly, is that this means taxing the people,” he told reporters after attending the Budget 2027 engagement session at the Finance Ministry here Tuesday (Aug 18).
Budget 2027 is expected to be tabled in Parliament on Oct 9.
Anwar, who is also Finance Minister, was asked about suggestions to integrate elements of GST and SST to create a more progressive tax system.
He said GST would require those who currently do not pay taxes to contribute, adding that justifying this would be difficult amid current cost-of-living pressures.
“Even though they say it is more efficient, taxing the people means those who have never paid tax before will have to pay.
“How do we respond to that in the current situation, with the cost of living and the burden on the people?” he asked.
However, Anwar said he would not compromise on avoiding a broad-based tax that would affect all Malaysians.
“I do not want a broad-based tax imposed on the people, which is the fundamental approach under GST.
“GST is a broad-based tax; we tax everyone. I do not agree with that,” he said.
Anwar reiterated that SST would remain the basis of the country’s tax system, although certain adjustments could be considered.
“The basis remains SST. But if there are certain features that we can accept, then we will accept them,” he said.
