Despite 2 years after the implementation of the Goods and Services Tax, Budget 2018 projects increasing reliance on income taxes

Dato’ Seri Najib Razak proudly announced that the projected budget deficit for 2018 will be 2.8% compared to 3.0% expected for 2017.

However, this target is to be achieved not via more prudent spending but significantly higher government revenue collection.  As previously expressed by the Prime Minister, his administration has been “saved” by the implementation of the Goods & Services Tax (GST).

The GST is expected to contribute RM41.5 billion to the treasury coffers in 2017, and further increase to RM43.8 billion in 2018.  This compares against income from Sales and Services Tax (SST) last collected from Malaysians in 2014 which amounted to RM17.1 billion.

However, despite the massive increase in Government revenues resulting from the GST, there was no reprieve for individual and corporate income tax payers.  In fact, it has become increasingly painful for Malaysian income tax payers.

For individuals, income tax contributions increased by 4.7% from 2015 to 2016.  However, for this year (2017), individual income tax contributions will increase by a massive 9.2% to RM30.1 billion.  For 2018, individual income tax collection for the Government will increase by another 7.1% to RM32.2 billion. This is inspite of the proposed 2% decrease in income tax rates for taxable income up to RM70,000 per annum.

For corporate tax payers, the increase in burden isn’t any less. While corporate taxes dropped by 0.1% from 2015 to 2016, it is expected to increase by 6.6% to RM67.8 billion this year.  Next year, the increase is even more, at a projected 6.9% to RM72.5 billion.

The above increases in individual and corporate income taxes are disproportionately higher than the 4-5% economic growth rates for Malaysia.

The above lends credence to the widespread discontent against the Inland Revenue Board (LHDN) for their heavy-handed tactics in squeezing substantially higher tax contributions from individuals and businesses. Some have even termed LHDN’s tactics as “tax terrorism” by demanding, with hardly any room for negotiation, backdated taxes of up to 10 years.

The above Budget proved that the Najib administration has not seriously implemented policies to impose prudence in spending.  Instead, it is relying almost entirely on increasing taxes to balance its books instead of cutting wastage, eliminating corruption and reducing the cost of government.

As a whole, this is reflected in the significant increase in the Federal Government operating expenditure which is expected to increase by RM14.4 billion 6.5% to RM234.3 billion in 2018.  In contrast, the increase in only by RM9.7 billion or 4.6% in 2017; while in 2016, the operating expenditure actually reduced by 3.1%.

In addition, the operating expenditure as a proportion to total expenditure continued its increase to 83.6%, the highest in Malaysian budget history.

Dato’ Seri Najib Razak’s 2018 budget speech, like the year before, was littered with political sniping and peppered with a litany of election year goodies.  It contained no meaningful reforms in economic policies and institutions to end corruption and wastage.

The 2018 Budget only served to prove the widespread fears that as long as there are no such serious reforms in place, ordinary Malaysians will be forced to bear increasing higher tax contributions – whether it is via the GST, individual or corporate income taxes.

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No clarity, more obfuscation: BN Strategic Communications Team's lengthy answer on how the Government arrived at a painful 20 sen hike for February petrol prices

I had issued a statement yesterday demanding that Dato’ Seri Najib Razak explain exactly how the Government arrived at a painful 20 sen increase for petrol prices.

RON95 and RON97 prices went up by 20 sen to RM2.30 (9.5%) and RM2.60 (8.3%) respectively while diesel cost went up by 10 sen to RM2.15 (4.9%).

This follows from the already big hike Malaysians have experienced since January where all types of fuel already increased in price by 20 sen.

Malaysians deserve a straightforward answer from the Government because they cannot fathom why the prices of fuel was upped significantly even though global crude oil prices have declined over the past month. What’s more, the beleaguered Ringgit actually recovered marginally which should ease the price pressures further.

Instead of receiving any response from any responsible Minister, much less the Finance and Prime Minister, we got a reply from the “BN Strategic Communications Team”. We don't know who they are, or even know what is their capacity to respond on behalf of the Government.

Regardless, taking their response at face value, they failed to provide any clarity on how the Government arrived at the painful 20 sen quantum of hike. If they could write such a lengthy essay to rebut my simple question, why couldn't they just attach the spreadsheet to justify the increase?

It explained that the pump prices was calculated from the average refined oil prices as measured by the “Singapore Means of Platts” (MOPS), which is already a widely acknowledged fact.

However, all that was further relevant from the statement was a paragraph which said, “a check on the MOPS would show that the average price of motor gasoline 95 unleaded for January had stabilised in a range of US$69 to US$70 per barrel and was materially higher than the average price in December 2016 where the price had steadily increased from US$62 at the beginning of the month to US$68 by December’s end.”

If the BN Strategic Communications Team is so confident of the numbers, why did they try to obfuscate the statistics with a fuzzy range of numbers, instead of just providing the specifics to justify the 20 sen hike?

I did the BN Strategic Communications Team a favour by doing the calculation on their behalf.

The average MOPS95 price for December 2016 is US$66.553 per barrel or US$0.4186 per liter. That works out to RM1.8753 per liter at the then exchange rate of US$1:RM4.48.

MOPS95 averaged slightly higher at US$68.820 per barrel or US$0.4328 per liter in January.  In turn, it translates to RM1.9130 per liter (US$1:RM4.42).

Hence based on the exact explanation provided by the BN Strategic Communications Team, the difference in price is only 3.8 sen more for January.

If so, why did the Government increase by so much more at 20 sen?

Therefore, my question raised yesterday remains unanswered, and Dato’ Seri Najib Razak, as both the Finance and Prime Minister, must explain why the price of petrol has increased so significantly despite the above.

The Ministry of Finance must disclose if the Government is actually imposing hidden taxes on the consumers to cover up for Government budget shortfalls.

Once again, we call for the full disclosure of the data, formula and exact details on how the fuel price hikes are calculated so that Malaysians know exactly why they have been forced to suffer as a result of the Government’s policies.

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Cheaper Cars: Fantasy or Reality?

BN, Pakatan spar over car prices
Nigel Aw
11:55AM Oct 11, 2012

The issue of cheaper cars heated up yesterday as the topic dominated a budget forum between Barisan Nasional's Kota Belud MP Abdul Rahman Dahlan and Pakatan Rakyat's Petaling Jaya Utara MP Tony Pua.

Pua (left), who began by comparing Pakatan's shadow budget with the federal budget, pointed out that the former focussed on increasing disposable income rather than providing one-off assistance.

"Most households have a median income of between RM1,500 to RM2,500 only. We looked at what is their largest monthly expenses and it was paying for car loan. Just a Myvi may cost RM600 to RM700 a month.

"If we reduce excise tax by 20 percent - we start with 20 percent first or the second-hand car industry may collapse - households can save RM70 to RM100 a month, that's a saving of RM1,000 per year," he told the forum in Shah Alam last night.

Adding on, Pua said the second highest expense was for housing loan, and on top of building more affordable housing, Pakatan will go a step further than BN by also breaking up the monopoly in the cement and steel sectors to make building materials cheaper.

'Contradiction of the highest degree'

However, Abdul Rahman accused Pakatan of taking on the issue in "silo" by failing to consider the myriad of issues that would also be impacted from the reduction of car prices.

"If you close a hole here then another hole will open up there. For example, you have not explained how you are going to solve the petrol subsidy problem when cars flood Klang Valley (and consume more petrol).

“I am also not confident that reducing excise duty will help reduce car prices... If excise duty goes down, cars like Honda may still maintain their prices because there is demand in Malaysia," he said.

He added that even though car prices in Malaysia were more costly, other related expenses such as petrol, insurance and road tax were still among the relatively cheap.

Abdul Rahman (right) also blasted Pakatan for wanting to make Kuala Lumpur a liveable city but concurrently would allow large number of vehicles to flood the city with cheaper cars.

"This is a contradiction of the highest degree," he said.

Responding to this, Pua pointed out that the car to population ratio had already exceeded one to one.

"Even if we make cars cheaper, there would be no marked increase because a person can only drive one car at a time, no one can drive two at a time and the maximum number of cars are already on the road," he said.

Improve public transportation first

He added that Pakatan planned to increase the number of buses in Klang Valley by the thousands to compliment the MRT system that is being constructed.

Abdul Rahman rebutted the argument that car numbers would not significantly increase, stating that this was merely an assumption.

"There are many people using buses and LRT, this means many people in Klang Valley still do not have a vehicle," he said.

To this, Pua replied that the public would still opt for public transport even if they have their own vehicles to get to work and a car was mostly for family leisure.

"It is not that anyone who starts work wants to buy a car, some people buy a car because they have no choice, or else they cannot go to work," he said.

He added that only after people have a real choice between public and private transport, after the former is adequately improved, considerations could be made to slash petrol subsidies.

Another panellist at the forum was Institute for Democracy and Economic Affairs (Ideas) chief executive officer Wan Saiful Wan Jan and the session was moderated by Universiti Islam Antarabangsa (UIA) lecturer Maszlee Malik.

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GST - The Lazy Cure for Deficits

GST a ploy to hide economic ills, says Pakatan
By Lee Wei Lian September 27, 2012

KUALA LUMPUR, Sept 27 — Putrajaya’s desire to implement the goods and services tax (GST) in the future is an easy way get more money and divert attention away from economic problems such as inefficiency and corruption, says Pakatan Rakyat (PR)

While the Barisan Nasional (BN) government is not expected to introduce the GST till after the general election, Minister in Prime Minister’s Department Datuk Seri Idris Jala was quoted in the Wall Street Journal yesterday that he expects the proposed GST to help boost state revenue and help put an end to the federal budget deficit by 2020.

[...]

DAP publicity secretary Tony Pua said that while GST was supposed to broaden the tax base as only an estimated 10 per cent of Malaysians currently pay income tax, the question that needed to be asked was why were so many Malaysians earning so little as to fall below the taxable threshold.

He said that even if 10 per cent out of the people who are not currently paying tax are tax dodgers, GST still would not make sense as it meant that many more low-income Malaysians would be burdened.

“If they can’t earn enough, why should they be burdened with additional taxes,” he said. “People’s incomes have not increased significantly.”

Pua also said that there was little risk of a sense of entitlement developing among those who do not currently pay income tax.

He also questioned what the government would do with extra income earned from GST.

Pua said BN should look at cutting expenditure, getting value for money, open tenders and abolishing corruption as ways to save money rather than imposing more taxes.

“Has the government exhausted all the means?” he asked. “If they have not there is no need to impose new taxes.”

He said that getting more funds from taxes will not solve the problem of the deficit if leakages are not plugged.  The DAP lawmaker also warned that once GST was in place, rises in the tax were almost inevitable.

He said that GST was a “lazy” approach to solving the country’s revenue issues and PR’s approach was to cut wasteful expenditure and leakages as well as increase revenue through non-tax avenues.

Pua wanted to know what the government would do with extra income earned from GST.
These include land sales through open bidding and increased revenues from government-linked companies (GLCs).

“We believe we can balance the federal budget without GST,” he said.

Malaysia has been running a budget deficit since 1998 and stated its intention to implement GST several times since approving the law in 2009 but has always postponed the new tax, which has some 3,000 exemptions.

Prime Minister Datuk Seri Najib Razak said in September last year that GST would be introduced “probably after the next general election.”

For the full story on The Malaysian Insider, click here.

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GST to Fund the Poor?

Recent months have seen various Ministers, including the Prime Minister Datuk Seri Najib Razak himself putting forward the proposal that as the Goods & Services Tax (GST) gets implemented, the Government will concurrently reduce our income tax levels.

The latest Minister who has joined the fray is Datuk Idris Jala, the CEO for PEMANDU and Minister in the Prime Minister’s department, who went further to argue that only with the GST, accompanied by reductions in income taxes will the Government be able to fund its policies for the poor.

Datuk Idris Jala said that “with the GST in place, all 28 million Malaysians will pay a little bit which then allows to reduce corporate and income tax and that’s how we can find enough money for the poor people.” The statement is a little shocking coming from Datuk Idris Jala, who’s normally fairly sensible, and completely perverse in its logic.

Today, only approximately 15% of the working population earn enough to afford paying taxes, and that means that the overwhelming majority of the work force is earning less than RM3,000 a month. They are not paying taxes not because they do not want to, but because they are not earning enough to.

What the BN government is proposing to do is to reduce the taxes paid by the wealthier 15% of the working population, and redistributing the tax burden to the 85% who currently do not earn enough to qualify to pay taxes.

The irony is that now the Government is arguing that by taxing the rich less, taxing the poor more, they will be able to source increased funds to support the poor! In effect, the Government is arguing that the wealthier segments, particularly the corporates should stop funding policies in support of the poor, and the poor should fund policies for themselves!

There is no question that the Government cannot rely heavily on taxes derived from the oil and gas sector which today constitutes close to 40% of all government revenue collection. However, the way to do it is not by crudely taxing the rakyat more, particularly those from the lower income groups. Otherwise, should Petronas “strike oil” again and is able to increase its revenue contribution to say, 60% of total government revenue, does it mean that the Government will then increase GST to say 10% for the purposes of “broadening the tax base”?

The appropriate method to increase and broaden our income tax base is to implement policies funded by our oil and gas windfall profits which will raise the income and productivity of ordinary Malaysians. Such policies will include drastically improving the quality of education as well as setting a reasonable minimum wage. Once the income levels of Malaysians increase, automatically, based on existing tax structures, more Malaysians will be paying taxes and the Government will be able to “broaden” its tax base without burdening the poor.

In the short term, the best measures for the Government to implement to increase revenues and reduce expenditure is to introduce competition into all its policies – such as competitive auctions for state land to maximise revenue, and competitive tenders for all privatisation and procurement projects to minimise cost and reduce leakages through wastage, rent-seeking and corruption. Such measures, if imposed with political will, will be more than sufficient to fund policies for the poor in the short to medium term.

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IRB to act against KDSB?

IRB to act against KDSB over tax arrears
By Clara Chooi July 14, 2010

KUALA LUMPUR, July 14 —The Finance Ministry announced today that the Inland Revenue Board (IRB) was taking “appropriate action according to the provisions in the law” against turnkey contractor Kuala Dimensi Sdn Bhd for failing to settle RM328.4 million in taxes.
Deputy Finance Minister Datuk Dr Awang Adek Hussin told Parliament today that the IRB had no provisionary powers under the Income Tax Act 1967 to confiscate assets or cash from KDSB, the key contractor in the controversial Port Klang Free Zone (PKFZ) project.

“However, the IRB is taking appropriate action according to the provisions in existing laws,” he said in his response to an adjournment speech by Tony Pua (DAP-PJ Utara) this evening.

In his speech, Pua questioned IRB’s apparent lackadaisical and carefree attitude towards KDSB by allowing it owe such a high amount in backdated taxes over the past 13 years.

“The IRB’s attitude has led to a lack of public confidence towards the government. It looks as if the government is partial towards companies owned by influential tycoons. Meanwhile, the common man who works hard to support his family is punished quickly by the IRB to prevent him from evading taxes.

“We hope that the IRB will take stern action quickly to collect these tax arrears from KDSB, including taking court action,” he said.

KDSB is owned by Bintulu MP and Barisan Nasional backbenchers club chairman Datuk Seri Tiong King Sing.

Pua further questioned why the board had not exercised its powers under the Income Tax Act 1967 to collect the tax arrears before any appeal or dispute was made.

“Why did the IRB not seek court intervention to confiscate the cash and assets of the KDSB, worth as much as RM932 billion, to settle the arrears?” asked Pua.

He pointed out that KDSB should be bound by Section 103A(2) of the act, which stipulates that “tax payable under an assessment for a year of assessment shall be due and payable on the due date whether or not that company appeals against the assessment”.

“This means that whatever the assessment made by the IRB should be paid by the individual or the company although the said party plans to appeal or dispute the amount quoted,” Pua asserted.

He said that on July 23, the IRB had produced a letter to the Port Klang Authority, ordering it to stop payment to bondholders in the troubled PKFZ project.

The IRB had then invoked the law to compel the PKA to act as a collecting agent and remit the RM328.4 million owed in outstanding taxes.

“But after an appeal was made by the PKA following protests from the bondholders, the IRB had on June 30, retracted its orders to the PKA.

“According to the KDSB chief executive officer Datuk Faisal Abdullah, the outstanding taxes in question came from came from accounts in the years 1997 and 1998.

“The KDSB further disputed the amount quoted by the IRB,” said Pua.

In his response, Awang Adek explained that KDSB had submitted its tax returned for the years 1996 until 2006.

“In the years 1996 and 1999, the KDSB was subjected to income tax, which it settled in full. For the other years, KDSB was not taxed as it reported high losses.

“For the assessment year of 2000, which is the waiver year, however, KDSB reported unusually high profits and the IRB found there were discrepancies in the information it was furnished. Due to this, the IRB initiated an investigation on the firm on Nov 1, 2007,” he said.

He added that the investigation showed that KDSB had under-reported its revenue and made unlawful expense claims under the act.

“However, the KDSB disputed our findings and failed to provide documents to prove its claims,” he said.

Awang Adek said that on June 18 this year, the IRB produced an additional assessment of taxes under Section 91 of the act, which amounted to RM328.4 million.

“Since this issue was brought up in 2010, the issue of the tax arrears for the past 13 years does not arise,” he said.

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The Perfect Scam?

Will Kuala Dimensi Sdn Bhd (KDSB) get away scot free for not paying RM328 million in outstanding taxes?

The Port Klang Authority (PKA) is due to pay the next instalments amounting to RM772 million in 2010 to various bondholders on behalf of Kuala Dimensi Sdn Bhd (KDSB). The latter which is owned by Barisan Nasional Backbencher's Chairman in parliament, Datuk Seri Tiong King Sing, is the main contractor for the controversial Port Klang Free Zone (PKFZ) white-elephant project which may cost the government up to RM12.5 billion.

Despite the fact that PKA has sued KDSB for up to RM1.4 billion for fraudulent and excess claims last year, the former was instructed by the Ministry of Finance to make an instalment payment of RM660 million in 2009 due to the fact that the former Minister of Transport, Tan Sri Chan Kong Choy, having provided a guarantee to the bonds raised by KDSB.

However, it has now been discovered that KDSB has outstanding taxes due to Inland Revenue Board (IRB) amounting to RM328.4 million. The IRB has in its letter dated 23 June 2010 to PKA instructed that any payments due to KDSB must have the unpaid taxes deducted, and made payable to IRB. The IRB is empowered to do so under the Section 67(4) and 68(1) of the Income Tax Act 1967.

PKA has accordingly informed the various KDSB bondholders of its intent to withhold 2 payments – RM230 million due on 30 June 2010 and RM120 million due in July 2010 – for the purposes of settling the outstanding income taxes of KDSB.

The KDSB bondholders are understandably upset with the development as there is a likelihood tha they may not be paid for the loans extended to KDSB. However, based on the previous action taken by the Ministry of Finance, they will once again insist that PKA make full payments amounting to RM772 million to the bondholders to fulfil the “guarantee” which has been provided by the Government by virtue of the letters of guarantee signed by Tan Sri Chan Kong Choy.

In such eventuality, the result will then be the “perfect scam” of the century where the IRB gets to collect its taxes, the bondholders get to recover their “investment” with interest, while KDSB escapes from all its obligations without having to fork out a single sen of tax.

Since PKA has paid IRB on KDSB's behalf from the payments due to the bondholders, IRB will not need to sue Datuk Seri Tiong King Sing and KDSB to recover the outstanding taxes. At the same time, since the Ministry of Finance feels obliged to honour the dubious letters of guarantee issued by Tan Sri Chan Kong Choy despite a RM1.4 billion pending legal suit by PKA against KDSB, the bondholders will get paid their dues. Hence there will be no need for the lenders to sue Datuk Seri Tiong King Sing and KDSB to recover their outstanding loans.

The complete burden amounting to billions of ringgit is shifted to the hapless and helpless rakyat who are forced pay for the follies of the Barisan Nasional government, enriching KDSB and its shareholders while those possibly guilty of criminal breach of trust such as Tan Sri Chan Kong Choy gets away scot free. This is the perfect exemplification of a “people first” government.

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Of Deficits & Bureaucracies

Cut deficit by reducing bureaucracy, says DAP

OPPOSITION MPs questioned whether the Government could reduce fiscal deficit to 3% of the Gross Domestic Product by 2015, saying it would be a “very challenging target.”

DAP national publicity secretary Tony Pua said this was only achievable if the Government changed the way it worked and the world economy was strong for the next five years.

The DAP PJ Utara MP said the easiest way to reduce deficit was to tax the people and cut subsidies.

“But what really needs to be done is for the Government to transform the way its machinery works. At present, it is a huge bureaucracy,” he told reporters at the Parliament lobby after the tabling of the 10th Malaysian Plan.

Pua said the Government’s operating expenditure, which takes up more than 70% of the Budget, was too high.

“And this is despite the huge increases in revenue over the past two years. In the next few years, there will be a decline in revenue from the oil and gas sector but operating expenses will maintain, causing stress to the deficit,” he said.

He also said the 10MP was a “rehashed”version of the previous Malaysia Plan, pointing out that the public-private partnership, high speed broadband and transportation plans had been part of the Ninth Malaysian Plan.

For the full article in The Star, click here.

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GST on Sarawak

The Deputy Finance Minister informed the Senate yesterday that the Government will proceed with the implementation of the unpopular Goods and Services Tax (GST) after the expected passing of the Price Control and Anti-Profiteering Act in Parliament.

Datuk Seri Awang Adek Hussin argued that “there is a lot to be gained by the government and the country with the implementation of GST, among them, a new source of revenue.”

We agree that there is indeed a lot to be gained by the government as they will increase the amount of tax collected from the people, but what will be gained by the people who has to bear the burden of paying more taxes?

Sarawakians will be among the worst hit with the implementation of GST as the state is the fourth poorest in the whole Malaysia, only ahead of Sabah, Kelantan and Terengganu. Currently there are less than 8% of the working population in Sarawak who are paying income taxes. The remainder of the population just do not earn enough money to pay any taxes.

Once GST is implemented, everyone, regardless of whether you are unemployed, low income, a single mother, an elderly or disabled, you will have to pay GST for practically all purchases. As many Sarawakians are still living in poverty or at near poverty levels, the GST will badly affect their livelihood.

The Barisan Nasional government have insisted that basic necessities such as rice, flour, salt, sugar, meats and certain seafood items will be exempted from taxation, and the poorest in Malaysia will even save RM14.52 per annum with its implementation.

The Government's model is competely flawed because it assumes that the poor will only spend all their monies on GST-exempted basic goods. The poor will still have to pay GST when buying shampoo, clothes, shoes, cutlery, furniture, soap and other household items.

Even for tax exempted goods, the price is likely to increase despite the tax exempt, because the cost of production of items such as rice, flour etc. will increase due to GST.

While the Government may pass Price Control and Anti-Profiteering Acts, and promise enforcement, we all know that such enforcement will have very limited practical impact. The government cannot even enforce controls over taxi drivers who refuses to use meters in the cities, can we expect more from a nationwide enforcement of all shops? Furthermore, how is the Government going to penalise say a petty hawker, for charging RM0.10 more for his cup of teh tarik or RM0.20 more for his plate of noodles?

In the interest of many states which are still engulfed in poverty or near poverty, including hundreds of thousands of Sarawakians, we call upon the government to withdraw the proposal to implement GST.

To resolve the budget deficit and debt issues faced by the Government, the BN Government must first take concrete steps to reduce massive corruption, inefficiencies and wastages for all procurement and privatisation programmes and completely eliminate the entrenched system of rent-seeking and patronage, instead of taking the easy way out by shifting the burden to the rakyat at large.

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GST Cure For Widening Deficit?

It came as no surprise when Professor Danny Quah, based at the London School of Economics claimed that Malaysia's sovereign debt is teethering towards the Greek abyss where our debt to GDP ratio will hit 70% by 2015 and may accelerate further to levels beyond 100% by 2020.

As it is, our debt has ballooned from RM242 billion in 2004 to RM363 billion in 2009, a sharp increase of 49.7%. This is despite the fact that over the same period, due to high oil prices, Petronas contributed RM217 billion to the state coffers.

It is hence important that this blatant abuse and mismanagement of government finances be rectified to ensure a sustainable future for the Malaysian economy and prevent a collapse like that suffered in Portugal, Iceland, Greece and Spain (PIGS).

What is however, completely shocking and unbelievably naïve is for the member of the National Economic Action Council (NEAC) is his prescription that the implementation of a new Goods and Services Tax (GST) “is something we desperately need because the traditional steady sources of revenue are literally drying up”.

Professor Danny Quah also said that “with a narrow tax revenue base, Malaysia has no choice but to implement the GST as a long-term solution, with a view to gradually raising the rate.”

The deterioration of Malaysian public finances is painful, but to prescribe GST as the ultimate cure is like prescribing Panadol to the patient who suffers from cancer.

Professor Danny Quah failed to emphasize the major cause for the current state of public finances today. Corruption has become increasingly rampant with Malaysia slipping down the Transparency International's Corruption Perception Index from 33rd globally in 2003 to a shameful 56th in 2009.

Corruption coupled with blatant wastage and inefficiencies created by rent-seeking and patronage, such as privatising profitable government owned entities at rock-bottom prices to cronies, the granting of licences and concessionaires to parties with vested interest without any form or tender or competition have led to billions siphoned from the Government. Such contracts have continued extensively under Datuk Seri Najib Abdul Razak's regime as

a RM628 million contract was awarded to Naza TTDI to build Malaysia's largest exhibition and convention centre in exchange for a piece of land valued as much as RM1.5 billion,
a 20-year interest free loan of RM320 million extended to a private concession company SYABAS Sdn Bhd,
an opaque 3,000 acres Sg Buloh prime land development project which is expected to be awarded to Malaysian Resources Corporation Bhd (MRCB), via a Government joint venture with the Employees Provident Fund (EPF) and
a RM8 billion intent by the government to purchase 257 armoured personnel carriers from DRB Hicom Bhd for the astronomical amount of RM31 million each

Failure by the government to put in place good governance policies such as open and transparent tenders, curbing corruption, rent-seeking and patronage will cripple our public finances regardless of wheter GST is implemented or not.

To put it simply, if there's a hole in the pocket, and you are short of cash, no matter how much money you beg from the streets to squeeze into the pockets, you'd still lose all the money with the hole only getting bigger.

It isn't rocket science to solve our public finance problems, and it certainly doesn't take an economist from LSE to prescribe panadol to solve our cancer. To solve our public finance crisis, the Government just needs to plug the massive leaks by mending the big hole in the pocket.

The problem with our economy is hence the complete lack of political will by the Najib administration to be completely transparent, be ruthless in fighting corruption and eliminating political patronage and to uphold the principles of open tenders via merit and competition despite Najib's pledges to the contrary under the New Economic Model (NEM).

GST will on the other hand just give additional funds to refill the coffers of the Government and the BN leaders to enrich themselves, at the expense of the rakyat at large.

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KJ: GST Won't Burden Consumers

In an exclusive interview with Malaysiakini.tv, UMNO Youth Chief Khairy Jamaluddin discusses the controversial GST bill and was in favour of quick implementation of GST.

If you have not watch my take on the same issue with Malaysiakini, it's available here.

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Video: Tony on GST

Well if you are not yet sick of the Goods & Services Tax (GST) topic, below is the link to an exclusive video interview with Malaysiakini.com which was done before the BN Government chickened out and withdrew the Bill from debate in Parliament.

I had predicted a U-turn by the current Najib administration, after earlier U-turns on the 5% real property gains tax as well as the tiered petrol subsidy programme, but only after the Bill has been approved. However, it appeared that this government clearly didn't think through their policy considerations in depth, and withdrew the Bill even before debate on the pretext that "further consultations are needed with the public". The question is, why didn't they consult first, then draft/present the bill, but instead, try to force the bill through, then say consult later?

For those who prefer to read about the interview, instead of watch it over Internet video, you will find 2 reports on Malaysiakini - "U-Turn on GST was waiting to happen" and "GST = Taxation without End"

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GST & Other Taxing Issues @ Alor Setar

The roadshow on GST continues. I've done Ipoh, Shah Alam, Cheras, Semenyih, Johor Baru, Penang, Petaling Jaya and will now head to Alor Setar at the end of the month.

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Why Did Najib Panic On GST?

Yes, Barisan Nasional has chickened out on the proposed new legislation on the Goods and Services Tax (GST) which was intended to be tabled in parliament for approval in the current sitting. This makes our new Prime Minister, Datuk Seri Najib Abdul Razak, who's celebrating his one-year anniversary next month as the country's premier, a bigger flip-flop than our previous prime minister.

To date, Datuk Seri Najib Abdul Razak, despite having the motto of "performance now", has already reversed 3 key policies on the real property gains tax (RPGT), the tiered fuel subsidy scheme and now the GST. Worse, he has also delayed the announcements over the restructuring of tolled highways and his much "anticipated" New Economic Model, not once, but multiple times. The indecisiveness of the current administration is uncanny and certainly serves for juicy political analysis.

Yes, the GST Bill is now "postponed", but the economic issues affecting Malaysia (and the reasons why GST won't solve them remains). So come hear how the Government has completely lost the plot on the economy.

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BN Government U-Turns Again!

Within a short period of a few months, the Government has made several embarrassing policy U-turns after first trumpeting the new policies. Late December, the Government chose to significantly amend its 2010 Budget announcement of 5% Real Property Gains Tax (RPGT) from an unlimited time-frame to a 5 year period.

This is followed by another shocking reversal of the decision to implement the complicated tiered petrol subsidy scheme, which has already cost the government tens, if not hundreds of millions in terms of project implementation cost. The decision to execute such an impractical policy without proper public consultation exposed the 'hare-brained' nature of the Government's policy-making process.

Now, with the “postponement” of the 2nd reading of the GST Bill in parliament, it marks another loss of face for the new Datuk Seri Najib Abdul Razak's administration, and worse, caused the public confidence of the Government's ability to steer the economy to sink to a new low.

Besides the above U-turns, the Government has also demonstrated severe indecisiveness in dealing with pressing socio-economic issues such as the restructuring of the tolled highway infrastruture which was originally due in August 2009 but has been postponed indefinitely, tariff increase for tolled highways and electricity. Even the much anticipated cornerstone economic policy of Najib's administration, the “New Economic Model” has been delayed twice since the start of 2010 to Jun 2010.

The U-turns and indecisiveness of government policies are further compounded by its inability to practise what it preaches with regards to “open tenders” and maximising value for government owned assets. For example, the Government continues to award mega-projects such as the proposed Matrade's largest exhibition and convention centre in Malaysia which was awarded without any tender, open or closed, to Naza TTDI for RM628 million. Worse, the Government has paid for the above works with a 62.5 acres piece of land, which should have been auctioned openly to “maximise value” for the Government.

This latest U-turn only shows that the Government has not been able to get its act together in managing the country's economy, especially in dealing with the ballooning deficit and government debt which has increased to 52% of the country's Gross Domestic Product (GDP).

While the Prime Minister made several encouraging announcements with regards to the liberalisation of the economic environment in Malaysia at the start of his reign in April last year, the public's hopes on the transformation of Malaysia's economy is now severely dented with a Government that does not know what it is doing and which is missing the woods for the trees by placing priorities on items such as the GST, when it should be doing more to institutionalize best practices such as 'open tenders' to increase efficiency and competitiveness, while reducing wastage and corruption.

The 'postponement' of the GST Bill marks an early success for the efforts by Pakatan Rakyat in our campaign to oppose the tax which penalises the middle and lower income Malaysians. As the Finance Minister said that the Government wants to collate more public feedback before deciding on the GST, Pakatan Rakyat will continue with its public forums especially those which have already been organised to ensure that the rakyat gets the full facts to make informed decisions on the GST.

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GST Coming Near You!

Apologies for the lack of updates recently. Have been partly busy with various Chinese New Year events, as well as working on the upcoming Goods & Services Tax (GST) campaigns, plus of course all the other "mundane" stuff for the party. Plus of course, you'd excuse me for "skiving" allocating time for the missus and kids ;-)

Pakatan Rakyat's Anti-GST campaign has gotten off the ground, kicking off in Shah Alam auditorium on the 24 February. I've since made it a key theme in my dinner ceramah speeches, including the last two in Bercham, Ipoh and Kg Bemban, Batu Gajah. A whole series of forums and ceramahs specifically on the GST has also been lined up, and you can catch the debates and arguments at the following days and locations:

• 3 Mar (Wed) 8pm - KL Selangor Chinese Assembly Hall (Mandarin)
  Tony Pua (DAP) v Chua Tee Yong (MCA)
  Organised by KL Selangor Chinese Assembly Youth
  
  
• 4 Mar (Thu) 8pm - Dewan Orang Ramai, Semenyih (Malay/Mandarin)
  Dr Hatta Ramli (PAS), Arul (PSM), Rafizi Ramli (PKR), Tony Pua (DAP)
  Organised by Parti Sosialis Malaysia (PSM)
  
  
• 5 Mar (Fri) 8pm - Dewan MBKj Tmn Suntex, Bt 9 Cheras (Malay/Mandarin)
  Organised by Pakatan Rakyat Hulu Langat
  
  
• 6 Mar (Sat) 4pm - Tropical Inn, Johor Bahru (English/Malay/Mandarin)
  Organised by Pakatan Rakyat Johor
  
  
• 8 Mar (Mon) 8pm - Dewan Kompleks Masyarakat Penyayang, Pulau Pinang (English/Malay/Mandarin)
  Organised by Pakatan Rakyat Pulau Pinang
  
  
• (Tony Pua then takes a family holiday break from 9th - 16th ;-))
  
  
• 17 Mar (Wed) 8pm - Crystal Crown Hotel, Petaling Jaya (note change of venue)
  Organised by Lau Weng San, ADUN Kg Tunku, PJ
• 20 Mar (Sat) 7pm - Simpang, Taiping-Bkt Gantang Dinner Ceramah
  Organised by DAP Perak (Dinner tickets 05-2531532)
  
  
• 27 Mar (Sat) 8pm - Alor Setar (venue to be confirmed)
• 31 Mar (Wed) 8pm - Subang Jaya USJ (venue to be confirmed)
  Organised by Hannah Yeoh, ADUN Subang Jaya

I'm sure more ceramahs and forums are being organised. The above are just those I'm speaking in, and doesn't yet include those which involves other speakers or where I can't make it. ;-)  See you there!

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Pakatan Rakyat Anti-GST Forums Kicks Off

Forum Awam: Implikasi Cukai GST Kepada Rakyat

Date: Wednesday, 24 February 2010
Time: 20:00 - 23:00
Location: Auditorium MBSA, Shah Alam

Panelis:

1. YAB Tan Sri Dato' Seri Abdul Khalid Ibrahim, Dato' Menteri Besar Selangor
2. YAB Lim Guan Eng, Ketua Menteri Pulau Pinang
3. YB Dr. Dzulkifli Ahmad, Ahli Parlimen Kuala Selangor
4. YB Tony Pua, Ahli Parlimen Petaling Jaya Utara
5. Sdr Rafizi Ramli, Ketua Eksekutif Pejabat Penasihat Ekonomi Selangor

Forum Awam Bermula
Moderator: YB Nik Nazmi Nik Ahmad, Setiausaha Politik kepada Dato' Menteri Besar Selangor

Masuk adalah percuma

Hubungi: 0355447017 / saifullahzulkifli@gmail.com untuk maklumat lanjut

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GST on TV9 "Hujah"

I was invited to the Malay-language 'Hujah' talk show on TV9 at the end of last year to discuss the issue of Goods and Services Tax. Together with me was the MP for Pulai, Datuk Nur Jazlan speaking on behalf of the government. It was a 30 minute programme, so it's split into 4 parts on YouTube below. Enjoy ;-)

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GST on The Fairly Current Show

Peter Parker Pua and me had a quick 10 minutes interview with The Fairly Current Show on everything fairly current, including GST, Najib, Pakatan Rakyat and more ;-)

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My Speech @ Pakatan Rakyat Convention

I was given the task and honour to present the Economic section of the Pakatan Rakyat Common Policy Framework (CPF) during the historic inaugural Pakatan Rakyat Convention. There were a slew of policy outlines contained in the framework (which is available here), but I outlined some of the broader policies within the 20 minutes given to me.

The original full text of my speech is here below, but I probably only read 50% of it, leaving out vast chunks, while going off the cuff for the balance.

Dasar Ekonomi yang mementingkan rakyat dan tidak akan membebankan rakyat sewenang-wenangnya.

Kami membantah perlaksanaan cukai-cukai yang tidak adil ke atas rakyat jelata seperti cukai barangan dan perkhidmatan (GST)

Untuk menjimatkan wang supaya rakyat tidak dibebankan, kerajaan di bawah pimpinan Pakatan Rakyat akan membanteras ekonomi bersifat rasuah dan kroni. Hasrat Pakatan Rakyat adalah untuk mencapai impian sebuah ekonomi yang demokratik dan telus

Pakatan Rakyat beriltizam melaksanakan dasar-dasar pengurusan ekonomi yang bebas rasuah, penyalahgunaan kuasa dan kronisme bagi meningkatkan kepertanggunjawaban, ketelusan dan urus tadbir yang baik.

Kebejatan rasuah dan penyalahgunaan kuasa telah melenyapkan kekayaan dan mengekang pertumbuhan mapan serta menghakis daya saing negara.

Pakatan Rakyat akan merombak sistem tender supaya adil, telus, terbuka dan memberi nilai terbaik untuk wang rakyat. Kita menolak kerajaan Barisan Nasional yang cakap tak serupa bikin. Perdana Menteri yang selaku Menteri Kewangan, Datuk Seri Najib Abdul Razak menekankan bahawa kerajaannya akan bersifat telus dan mengamalkan proses tender terbuka atau terhad untuk mengurangkan ketirisan dan rasuah.

Akan tetapi Kementerian Perdagangan Antarabangsa dan Industri telah menswastakan pembinaan pusat pameran dan konvensyen MATRADE yang bakal terbesar di Malaysia yang bernilai RM628 juta kepada Syarikat Naza TTDI. Pembayaran pula dibuat dengan memberikan sekeping tanah yang bernilai sebanyak RM1.5 bilion mengikut pakar penilai hartanah.

Inilah sebab yang utama mengapa kerajaan Barisan Nasional tidak terhenti-henti dilanda skandal mega-projek yang begitu besar seperti “bail-out” projek LRT dan monorail, projek “double-tracking” Ipoh-Rawang, projek Zon Bebas Pelabuhan Klang, syarikat Malaysia Airlines System, Indah Water Konsortium, dan pada masa ini, Syarikat Bekalan Air Selangor (SYABAS) dengan jumlah wang berpuluh-puluh bilion.

Kami percaya bahawa sebuah ekonomi yang demokratik dan telus yang meramalkan sistem tender secara wajib akan menjimatkan perbelanjaan kerajaan sebanyak berbilion-bilion setiap tahun dan pada masa yang sama, meringankan beban cukai kepada rakyat.

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Sebuah kerajaan Pakatan Rakyat akan meningkatkan hasil pendapatan cukai bukan melalui peningkatan kadar cukai ataupun perlaksanaan cukai yang baru. Sebaliknya, kerajaan Pakatan Rakyat akan meningkatkan cukai pendapatan dengan membina sebuah ekonomi kemahiran tinggi

Paksi kepada ekonomi berprestasi tinggi adalah tenaga kerja yang berpengetahuan, berketerampilan dan berkemahiran. Pakatan Rakyat akan membuat segala pelaburan yang diperlukan untuk membekalkan kewujudan warga kerja berproduktiviti tinggi ini bagi melonjakkan nilai tambah dalam kegiatan ekonomi negara.

Negara kita merupakan sebuah negara yang begitu bertuah, yang dikurniakan dengan rezab petroleum yang begitu lumayan. Malangnya keuntungan yang begitu besar pada tahun-tahun yang lalu telah dibazirkan oleh kerajaan Barisan Nasional dan akibatnya, Malaysia terperangkap dalam jerat pendapatan sederhana ataupun “middle income trap”.

Pakatan Rakyat akan menjamin peluang pendidikan tinggi dan latihan berteraskan ketrampilan dibekalkan dalam seluruh sektor perkhidmatan, pembuatan dan pertanian.

Kami juga akan menggalakkan warga neraga yang professional dan berkemahiran yang bermastautin di luar negara kembali ke tanah air dengan menyedaikan suasana kerja yang professional dan menarik.

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Kerajaan pusat bawah pimpinan Pakatan Rakyat akan mencetuskan penumbuhan ekonomi yang akan sekali lagi menjadi dinamik dan merangsangkan. Matlamat ini akan dicapai melalui dasar desentralisasi dan pengupayaan pengurusan ekonomi negeri

Selaras dengan semangat persekutuan untuk meningkatkan sistem penyampaian kerajaan, keberkesanan dan kecekapan perbelanjaan, maka pelaksanaan dasar pembangunan dan ekonomi yang meluas perlu diagihkan kepada kerajaan negeri mengikut keutamaan masing-masing.

Desentralisasi mampu mendorong perubahan struktural dalam kerangka ekonomi bagi lonjakan kecekapan ekonomi dan produktiviti menerusi peningkatan tahap kecekapan dalam perbelanjaan selain kesan gandaan yang meningkat hasil perbelanjaan kerajaan dalam ekonomi negara.

Pakatan Rakyat akan memulangkan sebahagian daripada kutipan cukai dari setiap negeri kepada negeri tersebut berdasarkan pengagihan yang adil dan pada masa yang sama, menambah geran per kapita untuk negeri-negeri.

Pakatan Rakyat juga akan melaksanakan formula geran pembangunan dan kesamaan berdasarkan faktor jumlah penduduk, kadar kemiskinan, kawasan pembangunan, kos, pembangunan modal insan dan indeks pendapatan kasar per kapita akan turut diberikan bagi memastikan negeri yang miskin tidak ketinggalan.

Hak negeri-negeri untuk membuat pilihan mengikut kesesuaian sendiri mengenai strategi pembangunan negeri mesti dihormati. Teras kepada hak ini adalah peruntukan kewangan yang secukupnya kepada negeri-negeri berdasarkan sumbangan terhadap persekutuan serta keperluan rakyat. Pakatan Rakyat akan menjamin royalti sebanyak 20% daripada hasil petroleum kepada kerajaan negeri dengan matlamat membasmi kemiskinan di kalangan rakyat. Ini akan termasuk wang royalti minyak yang telah dijanjikan kepada negeri Kelantan yang sehingga hari ini dinafikan dan enggan diiktirakkan oleh kerajaan Barisan Nasional.

Kami juga akan mengagihkan kuasa pentadbiran ekonomi dan perlaksanaan kerja prasarana kepada kerajaan negeri, misalnya hak rundingan saksama dalam menentukan reka bentuk dan jaringan pengangkutan awam.

Pakatan Rakyat akan menjana pembangunan kawasan yang lebih seimbang, sekali gus mencipta bandar sekunder yang produktif di seluruh negara demi mengurangkan pemusatan pembangunan di Lembah Klang

Dasar desentralisasi dapat mengutamakan dasar-dasar penjanaan pertumbuhan tinggi serta berjangka panjang, berasaskan pemahaman ekonomi di mana kerajaan negeri berada dalam kedudukan terbaik untuk menentu serta melaksanakan strategi sosio-ekonomi.

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Dasar ekonomi Pakatan Rakyat tidak bersifat hipocritikal seperti Barisan Nasional di mana slogan “rakyat didahulukan” merupakan retorik sahaja malahan Barisan Nasional terus mengambil langkah-langkah yang jelas membebankan rakyat seperti cukai GST, cukai kad kredit dan cukai keuntungan hartanah.

Pakatan Rakyat akan membasmikan cukai paksaan yang tersembunyi seperti tol lebuhraya, perjanjian penjanakuasa bebas dan tariff syarikat air swasta. Kami menolak penswastaan yang membebankan dan akan merunding semula konsistensi dan kontrak yang bersifat menguntungkan kroni dan tidak adil kepada rakyat, termasuk yang melibatkan IPP, tol lebuhraya dan prasarana air, dan jikalau perlu kerajaan bawah Pakatan Rakyat akan merunding semula segala perjanjian tol dan mengkaji pembelian balik lebuhraya PLUS dengan matlamat melupuskan tol dalam jangka masa 7 tahun.

Sebaliknya, penyediaan dan penyenggaraan prasarana awam yang baik merupakan tanggungjawab kerajaan. Perlaksanaannya bawah pemerintahan Pakatan Rakyat tidak akan membebankan rakyat atau menguntungkan kroni tertentu. Prasarana dan kemudahan awam yang baik membolehkan rakyat Malaysia meningkatkan pendapatan boleh belanja dan produktiviti mereka.

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Pakatan Rakyat beriltizam untuk ‘Merakyatkan Ekonomi Negara’ bagi memastikan kemakmuran dan kekayaan yang terhasil dikecapi oleh seluruh lapisan rakyat. Sekaligus merapatkan kesenjangan diantara kaya-miskin serta mengatasi ketidak seimbangan pembangunan wilayah akibat pengurusan tempang yang tidak mendahului kepentingan rakyat ramai.
Pakatan Rakyat memperakui bahawa setiap rakyat Malaysia berhak mendapat bantuan berdasarkan keperluan tanpa mengira latar belakang. Pakatan Rakyat bertekad untuk merakyatkan ekonomi negara, agar khazanah negara dapat dinikmati dengan adil oleh semua.

Pakatan Rakyat memberikan jaminan bantuan ekonomi dan pengagihan adil kepada semua berdasarkan keperluan tanpa mengira kaum dan agama. Antara langkah-langkah yang akan diambil termasuklah pemberian bantuan tunai secara terus kepada kumpulan sasar untuk menghapuskan golongan miskin tegar, menyediakan biasiswa pendidikan berdasarkan keperluan dan merit, menjamin mobiliti sosial dengan memastikan peluang ekonomi yang lebih adil dan sama rata untuk semua dan menggunakan penjimatan dari ketirisan dan pembaziran serta jihad menentang rasuah sebagai sumber tambahan bagi program membasmi kemiskinan

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Pakatan Rakyat mempercayai bahawa setiap rakyat Malaysia harus menikmati hidup yang bermaruah pada setiap masa. Rakyat yang hilang mata pencarian, warga emas, orang kurang upaya dan golongan berpendapatan rendah mesti dilindungi dan diberi peluang untuk turut menikmati faedah pembangunan ekonomi negara.

Kami akan menubuhkan Dana Penamatan Kerja untuk pembiayaan sementara rakyat yang hilang pekerjaan, subsidi untuk latihan semasa kerja dan latihan semula pekerja dan memperkenalkan usia tamat tempoh perkhidmatan 60 tahun bertujuan memberi peluang kepada mereka yang ingin terus menyumbang kepada masyarakat.

Pakatan Rakyat juga akan memperkenalkan gaji minima yang munasabah untuk semua pekerja Malaysia dan memperkenalkan Akta Peluang Saksama untuk memastikan peluang pekerjaan terbuka kepada semua. Kami percaya bahawa hanya dengan peluang yang saksama, pekerja Malaysia akan berinsentif untuk meningkatkan modal insan, produktiviti dan daya persaingan untuk mencapai tahap kerjaya yang cermerlang dan emolumen yang lebih tinggi.

Kami juga akan menyusun dasar pekerja asing yang bersepadu dan mengurangkan kebergantungan negara kepada pekerja asing dan menyediakan sistem sokongan kepada golongan terbabit dalam sektor ekonomi informal seperti peniaga kecil, penjaja, petani dan mereka yang bekerja sendiri.

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Pakatan Rakyat juga akan membantu sebahagian besar rakyat Malaysia tidak berkeupayaan memiliki rumah sendiri terutama mereka yang berpendapatan rendah dan sederhana.

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Pakatan Rakyat juga bertekad menjadikan ekonomi hijau sebagai teras kepada era kemakmuran baru yang lestari dan saksama untuk Malaysia. Penyediaan prasarana dan perkembangan industri baru sejajar dengan peralihan ke arah ekonomi hijau akan menjadi enjin penjanaan pertumbuhan ekonomi yang dinamik.

Antara langkah-langkah “ekonomi hijau” ini, Pakatan Rakyat akan memperkenalkan prasarana yang moden, lengkap dan sesuai untuk ekonomi karbon rendah, termasuk sistem pengangkutan awam berintegrasi bertaraf dunia dan sistem kitar semula yang menyeluruh. Kami juga akan memberikan tumpuan untuk membangunkan industri-industri yang berasaskan teknologi hijau seperti pembuatan panel suria dan sel fuel hidrogen.

Pada masa yang sama, untuk mendepani krisis perubahan iklim, kerajaan Pakatan Rakyat juga akan membudayakan amalan kitar semula dengan menyediakan prasarana dan sistem yang menyeluruh, memastikan segala aktiviti pembalakan dan penebangan hutan dijalankan secara terkawal, mengawal sebarang pembinaan di lereng bukit dan kawasan-kawasan berbahaya dan mrendahkan kadar pelepasan karbon selaras dengan piawaian antarabangsa dan meningkatkan daya sistem ekologi untuk menyerap karbon.

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Pakatan Rakyat bertekad menjadikan ekonomi negara berprestasi tinggi dan memiliki pertumbuhan mapan. Pemunggahan sumber-sumber dan khazanah negara secara cekap dalam pelaburan dibidang-bidang dan sektor-sektor utama dan strategik adalah penting bagi menjamin daya saing negara.

Kerajaan Barisan Nasional telah selama ini mentadbir ekonomi Malaysia dengan begitu lemah. Dasar ekonomi Barisan Nasional yang mengutamakan kekayaan pemimpin-pemimpin kerajaan dan kroni-kroni mereka telah menyebabkan kerugian besar kepada kerajaan Malaysia dan menjejaskan daya persaingan dan penumbuhan ekonomi kita. Tetapi oleh kerana negara kita bertuah dikurniakan dengan kekayaan petroleum yang dieksploitasi oleh kerajaan Barisan Nasional, rakyat tidak terasa kemerosotan ekonomi.

Akan tetapi oleh kerana Malaysia diserang kemelut ekonomi dunia, keuntungan Petronas jelas terjunam, kerajaan Barisan Nasional terpaksa mencari pelbagai helah untuk meningkatkan kadar cukai dan memperkenalkan sistem cukai yang baru seperti GST untuk mengutip lebih wang daripada rakyat yang sudah cukup derita.

Kerajaan Pakatan Rakyat menganggap tindakan Barisan Nasional sebagai satu langkah yang terdesak, and kami akan bantah pembentangan akta cukai GST sekeras-kerasnya supaya rakyat tidak diwajibkan untuk dihukum cukai atas kecuaian, pembaziran dan penyelewengan kerajaan Barisan Nasional. Sebaliknya, Pakatan Rakyat akan mengambil pelbagai tindakkan berdasarkan prinsip-prinsip yang telahpun dihuraikan supaya produktiviti dan kekayaan rakyat terus meningkat, dan Malaysia akan sekali lagi menjadi sebuah ekonomi yang cukup dinamik, menarik dan berdaya saing.

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