Thursday, December 17, 2009

Another Finance Minister Who Can't Count

The 2nd Finance Minister tabled the controversial Goods and Services Tax (GST) bill yesterday. To justify the implementation of the Goods & Services Tax, Datuk Seri Ahmad Husni Hanadzlah had claimed that “the rakyat will not be burdened under GST”:
  1. The household expenditure for the lowest income group will see savings of RM14.52 per year

  2. The highest income group will have RM346.92 savings.
At the same time for businesses, the Datuk Seri Ahmad Husni also stated that:
  1. Exporters would end up having tax savings of RM1.4 billion under the “zero-rated” system

  2. Impact studies showed that businesses overallstood to save RM4 billion in taxes under GST as professional services would be exempted.
However, despite the savings by the rakyat as well as businesses, the Government will still be able to increase its receipts from GST by more than RM1 billion compared to under the previous regime of Sales and Services Tax, which collected nearly RM12 billion from businesses alone.

The Minister's statements does not make sense just as money does not grow on trees.

If businesses will reduce tax contribution by RM5.4 billion as stated by the 2nd Finance Minister, while at the same time increase the collection of GST to more than RM13 billion, it can only mean that the additional RM6.4 billion must be collected from the rakyat!

The question then is, how is it that the Minister can come up with figures whereby both the lowest income group as well as the highest income group will enjoy savings?! The savings which will exceed RM6.4 billion for businesses is inevitably shifted to consumers, regardless of whether they are low wage workers, retirees, students or your average man in the street.

As such, the Pakatan Rakyat Anti-GST Taskforce will over the months of January to March when the parliament is not in session, undertake various measures to increase the awareness of the rakyat and receive feedback from various academics, industry experts as well as the public at large with regards to the Goods & Services Tax bill proposed by the Minister of Finance.

These measures will include:
  • convening Parliamentary Roundtable discussions with industry experts
  • convening a Parliamentary Caucus of Members of Parliament on GST
  • conduct nationwide forums at all state capitals and major cities nationwide
  • print information leaflets on GST for the public
  • setting up an information web site on the impact of the GST
  • setting up a public feedback email: NOtoGST@gmail.com
We seek public participation and assistance to carry out the above programmes and we look forward to hearing from the rakyat.

22 comments:

Anonymous said...

take this to the street... i bet the crowd will be even bigger this time. or simply leave it as it is, it is a good wake up call for those who voted for BN.

Anonymous said...

I'm all for educating the public about the true impact of GST, but will it actually make a difference or will certain factions in power just bulldoze their way to get it passed anyway? Ok, if you were successful in educating the public, then what? Demonstration where it'll be considered an illegal gathering? I just don't know how this would be brought forward. I feel as if it's a lost cause, eventhough the public may be furious with the decision, it will just be vetoed. There is an open day organized by our premier in Sunway today. Do you think we can bring things like these up? Hmmm, I wonder ...

Anonymous said...

This is such an elementary mistake. I can tell you that in Singapore, Hong Kong govt, such a bad calculation would have been spotted even before it come out. These are basic govt Math skills that all senior govt officials should already have.

Anonymous said...

As we all know in a real corporate world this guy would be sacked by the boss ,how can then our country lead economically with such tidak apa attitude?

Anonymous said...

Tony,

pls tell the corrupted gov't, show us the Petronas account and I WILL PAY the GST!

telur dua said...

Shoe polishers should end up as cobblers and not made to count.

Anonymous said...

This new GST scheme doesn't make any sense at all. We the working class people, keja bagai nak mati (need to work tirelessly to feed our family) have to pay more taxes than business owners??? How does this jive with 1Malaysia - rakyat didahulukan??? This clearly shows that the ministers couldn't care less about us rakyat who put them up there to serve us in the first place. Vote them out for the sake of our children

Anonymous said...

Thank you Tony. I look forward to the ensuing study result. I hope more people will be enlightened by these findings. It just baffles me how stupid the govt must take us for. Good luck sir!

Anonymous said...

A real dumb minister who can't perform simple addition! How can both tax authority (the Government) and the tax payers (the citizens) be the winner at the same time, when the givers give less and yet the receiver can gain more? It is really ridiculous! No wonder Malaysia is in such a pathetic stage !!

Anonymous said...

In any business when account shows deficit, there only 2 ways out, 1) Increase profit 2) Decrease cost. Then, if it was downturn/recession then maybe option 2 taken lead, as it would be unrealistic to increase neither revenue nor profit margin.
Fine, you want to increase tax, justify for it, face it, don’t justify thru this 1+1=0 art of science. Don’t eliminate the benefit of doubt (all this while we suspect there many ministers are dumb), the last thing you need do is confirm this doubt to the public, as this also confirmed another fact that majority of Malaysia has infinite stupidity! – why do we still voting this dumb and dummer to be the government? Or maybe we are a stupid nation!

Chong said...

The minister only mentioned that the lower income group (may be less than rm500 group)and highest income group (like all ministers) will save, but how about the middle income group?
This group have to pay for the rm14.52+rm346.92 and the expoerters rm1.4b.
So, if you fall in the middle income group, you have to spend additional rm361.44+++.

Anonymous said...

1 + 1 = -1. Well-done!

Govt. gets more $$$ with GST, someone just have to pay for it (unless the BN Govt. can get $$$ from the air like magic!).

It's clear the current non-tax paying M'sian residents (especially low-income group & retirees) will have to bear the burden.

Dr. Adrian Wong said...

Hi Tony,

It is obvious that the 1Malaysia government thinks that it's time for the poor to start paying their dues. Sad to say this, but for a desperately-poor government, the poor are an extremely large untapped source for tax. They can't reach them via income tax, so they get them through the GST.

I can see the merit of implemeting GST. It is a more efficient way of collecting tax for the government. However, it should be in tandem with a REDUCTION in income tax! Otherwise, it will end up as a form of double-taxation.

Sure, the government claims they will exempt basic necessities, but EVERYTHING IS CONNECTED! As long as the cost of living goes up due to GST, the cost of basic necessities will go up, even if they are not hit by GST.

I think most of us who keep updated online already know this. We are fuming not because we abhor GST per se. I think most of us are just plain angry at the unfairness of the GST system to be implemented by our government.

Not only is it a form of double-taxation, they have also included all kinds of ridiculous penalties and even intends to limit the legal recourse that can be taken up by the rakyat.

In other words, they aim to screw us with the GST. It is not the fair, equitable, efficient tax system they promised, but a monster waiting to be unleashed upon an unsuspecting rakyat.

I suggest that the PR should step up the media campaign on GST, but don't just concentrate online - go to the grassroots! Reach out to folks who don't already know what's going on!

And if I may be impertinent enough to suggest, please don't just talk about abolishing the GST. Talk instead about how a PROPER GST system should be implemented so it does not burden the poor and double-tax the rest of us. It would be a good idea to also point out the ridiculously severe penalties being proposed for the law, as well as the intentionally limited avenue for legal recourse.

Check this post out - http://wangsamajuformalaysia.blogspot.com/2009/12/proposed-gst-will-not-burden-people.html

MICHAEL LIM said...

On paper i agree with your comment. However I need the bill to see more details. Why don't you attach the bill to youtr site?.

Anonymous said...

Ha ha... all of you guys didn't know, including you, Tony. Our BN govt goons are connected with the BLACK MONEY GANG!!! That is how they add up, stupid... hahahaahahhahaah

1Malaysia for better Maths

telur dua said...

Deputy Minister Tan Lian Hoe said that the proposed withdrawal of the subsidy on sugar is for health reasons and 'nothing to do with money.' What rubbish.

I want her to tell it with a straight face to those earning 1.5 to 3 k per month. There are plenty of them.

najib manaukau said...

What can you expect from an UMNO goon ?
They wouldn't be in the cabinet if they can count ! The minister must thinks the people was only born yesterday or at best last week.
A sure byproduct of NDP or NEP !

Ahmad Syafiq said...

No la Tony. Probably the Finance Minister can count, it's just that GST sucks up everyone, rich and poor. Of course, rich will not be affected by much. It's the poor people who will suffer.

As I agreed with one of the comments above, yes, the poor people are exempted from income tax. However, with GST, no one can escape taxes. And that, is where the poor people suffer.

Even if the government are hard-headed to implement GST, just make sure they reduce income tax for the middle and low income group at the same time. That's the least they could do.

Probably with GST, they can gain more income than Service taxes as no one, and I MEAN NO ONE can evade taxes under GST. That's where the government can earn more tax revenue.

Anonymous said...

I agree with Dr Adrian Wong.

I am not anti-GST per se. I believe the GST can be a good tool to collect taxes, provided that parralel changes are also made to the collection of personal income tax as well as other business taxes. What's happening now is merely a shift to make the rakyat pay for the taxes on goods, while protecting the businesses. That's an indirect way to double tax us.

Please be careful how you guys 'educate' the people on the current proposal so that you leave room for proper implementation of GST in the future. Maybe we can push for lowering of the income tax since the 1govt insist on implementing the GST.

I am anti-corruption and I wouldn't want to handover anymore money to be wasted by this bleeding monsters running(ruining) the govt right now! What they have are already enough, but they choose to spend on luxurious things for themselves and self-glorification while the poor remains poorer and the middle-income folks slide to poor status. A simple case is the wastage on these smart schools and wonderful kindergartens while the really poor folks in Sabah and Sarawak can't even get access to proper primary schools. No proper roads, no proper buildings, heck, no electricity and clean water at home! They make life so difficult for these natives, it's incomprehensible how this can happen after more than 50 years governing the country.

Anonymous said...

I remember when Singapore implemented GST, there was a tax rebate and reduction of income tax rate to offset the impact of the GST. Will there be a reduction of our tax rates when GST is implemented here?

L H TAN said...

Dear YB Tony Pua
This is my first time to post in your blog and ever (in other blog).
The Second Finance Minister must be joking to say that there is a big saving for the poor and the rich.
You know what? The problem with PM, DPM, all the Minister and BN sinister don't feel anything since they are rich - we can read for example when one of the big shot house got broken into the jewellery, monies, etc up to hundreds of thousand and millions. PM's wife even share with us during the press conference about woman in Malaysia by adding her sons & daugther stuck in Washington due to the bad weather. Wondering how they can afford "RM" compare to people like me who is working in overseas and earning USD dollar (I only flew back to Malaysia - four times a year).
With GST, people in the street will suffer due to the chain of effect example restaurant (blame the supplier increase the materials), hawker laments cost of doing business increase, school bus will request increase due to cost of living, wow everything will jump.
I'm in Cambodia where things are cheap except for imported goods.
This is terrible for Malaysia where the purchasing power is less and I assured you that even Pakatan Rakyat reject the motion and definitely to people who support your BN MP will "äye" to 100% support thru the GST implementation after 2nd reading in the parliment. Don't blame anyone but ourselves. Luckily I voted the DAP in Penang island as such my conscience is clear. Good luck Malaysians and prepare to fork out more Ringgit to pay for your goods and makanan.

Anonymous said...

Tony,

All said & done.
What can we do to make these so-called intellegent ministers listen to us?

Can they show us how did they manage to come out with "their" figures?

This present goverment seem to be just squeezing & milking us till the last drop...!!
And many, many wastage of our tax paying monies.

Why is that??? The rakyat has made many "unhappy" comments & yet they choose to ignore us.

1Malaysia.
Why is that...??????????????