KUALA LUMPUR: The controversial goods and services tax (GST) is officially “dead” after the bill to repeal it was passed in the Dewan Rakyat today — three years after its implementation.
While wrapping up debate on the bill at the Dewan Rakyat, Finance Minister Lim Guan Eng said: “Finally, GST is dead.”
One of the MPs then jokingly said “Al-Fatihah GST”, which was met with laughter in the House.
The new government wants to replace the GST with the sales and services tax (SST).
The Sales Tax Bill 2018 was passed by the Dewan Rakyat yesterday and the Service Tax Bill 2018 got the nod today.
The bills will now be debated in the Dewan Negara, which is controlled by BN.
BN has 29 senators, controlling the majority in the Dewan Negara. PH has six senators, other political parties have 16 senators while the remaining 19 posts are vacant.
SST is a single-tier tax regime that the government hopes to implement on Sept 1. It plans to charge 10% for any taxable goods and 6% for any taxable services.
Lim said earlier today that he could not guarantee that prices of goods would not increase once the new tax was in place but he believed the impact of the SST would be half that of the GST.
A total of 5,443 items would be exempted from SST, compared with GST’s 540 items.
Abolishing the GST and replacing it with the SST was part of PH’s manifesto.