Malaysia to keep SST, with Anwar ruling out GST return for now
The prime minister said a GST review should wait until minimum income reaches at least RM4,000, while allowing changes to address double taxation under SST.
Malaysia will retain its Sales and Services Tax (SST), Prime Minister Anwar Ibrahim told the Dewan Rakyat on November 12, saying a return to the Goods and Services Tax (GST) would spread the burden to the wider public, including lower-income earners.
Speaking during Ministerial Question Time, Anwar, who also holds the finance portfolio, said the government remained willing to adjust SST to resolve specific cases of double taxation and improve how the system works.
He said SST primarily taxed businesses, though consumers bore a small share of the cost. By contrast, he described GST as a broad-based tax and argued that restoring it would move the burden away from businesses and exporters.
Anwar put current SST receipts at 3.2 per cent of gross domestic product, matching GST’s share in 2017. He challenged the view that bringing GST back would necessarily raise more government revenue.
He also said SST exempted about 2,000 categories of goods and services, against fewer than 750 under GST.
Any review of GST should wait until people’s minimum income reached at least RM4,000, Anwar said. He cited continuing pressure from living costs and said reintroducing the tax before incomes reached a reasonable level would be inappropriate.
