The PM Who Listens, Cares and Keeps Promises

The bigger democratic space we have in the Net has seen the insidious growth of negative commentaries, especially from those who choose to express opinions for the sheer pleasure of seeing their opinions published in social media platforms or online sites. Many rant from selfish or narcissistic inclinations that usually have malicious intent. How much of what we read is genuine and reliable? Poisoned by Opposition leaders and online sites, the perspectives and expressions of many are warped, untrue and distorted.

Realistically, we have a PM who listens, cares and walks the extra mile to keep promises. On August 23rd, he invited the rakyat (via Twitter) to share their views about their Budget. He promised to forward views shared to the Finance Ministry for further action. The main concerns expressed revolved around the high cost of living and the lack of affordable housing. His introduction in the Budget Speech last Friday certainly shows our PM is a man of honour who keeps his words. He said, “I hear the grouses of the rakyat who wish to own comfortable homes, especially those from low and middle income groups.”

Changes announced in the Budget such as the removal of sugar subsidy, implementation of GST and controls on excessive property speculation are intended to reduce fiscal deficit and prosper the nation to maintain economic growth to promote the well-being of citizens. Unfortunately, Opposition politicians, activists and many Malaysians have been harping on the wrong end of the stick and chose to focus on the withdrawal of sugar subsidy and the April 2015 implementation of GST without bothering to study the Budget in detail or appreciating the technical complexities of planning and implementing a national Budget that prioritizes the interests of the rakyat and the nation.

Why is there so much furore when there is a 17-month gap from now till April 2013 when the GST will be implemented? The proposed 6% rate is the lowest in the region (10% in Indonesia, Vietnam, Cambodia and Laos and 7% in Singapore and Thailand). Instead of focussing on this commendable rate, GST opposers have hurled unpleasant accusations and judgements at the PM by harping on their fallacious argument the GST will cause the lower income group to suffer. Actually, the GST automatically taxes the well-off segment of the population as they consume more. In this way, the lower income group will not be burdened. Obviously, the government has really taken the initiative to ensure the man in the street is not burdened by GST.

Unfortunately, Opposition leaders and activists have deliberately ignored the government’s decision not to impose GST on basic food items such as rice, salt, sugar, water and the first 200 units of electricity. Doesn’t this move show the government’s commitment to spare the poor from burdened by the GST? Why have many chosen NOT to elaborate on the Finance Ministry’s decision not to impose GST on passports, licenses, health services and travel? Not many know the RM300 one-off assistance to households of BRIM recipients. The compensatory move of lowering individual and corporate income tax aims to alleviate the middle income squeeze and to make GST more acceptable to the middle-income earners.

The rakyat has refused to acknowledge that the implementation of the GST will surely make consumers more prudent in their spending as the more we spend, the more we are taxed.

GST is certainly a more efficient tax system than the current framework as it can strengthen the fiscal position of the nation. Don’t forget the following:

• Tax rate for essential goods such as mentioned earlier and public transport will be set at zero
•The current sales tax, as well as the service tax of 6-10% will be repealed once the GST is implemented
•GST will be revenue neutral for the government because gains will be offset due to the termination of the sales and service tax
• Manufacturers are entitled to claim a rebate in the tax to the value that their suppliers added
only if proper and complete records are kept.
•GST will make it more difficult to evade taxes because complete records are necessary at each
stage of the taxation processes for businesses

Presently, only 6 million of the 29 million citizens pay taxes. The situation is exacerbated by the fact that not everyone declares their income for tax purposes. This trend is not only unhealthy but also economically unsustainable.

Through the GST, the government can broaden the tax base to narrow fiscal deficit as a tax is paid on each step of the process. Hence, it is a consumption tax that taxes people with consumption power based on their consumption. In this way, the government can boost government income and efficiency in government administration as the GST will widen revenue collection, ensure competition and reduce tax evasion with the hope for economic resilience and competitiveness.

Clearly, every Malaysian has to make an intelligent decision whether they want to help develop the country by moving in tandem with the Budget or to sit back, fold their arms and mock or deride the PM and his team who genuinely desire to strengthen economic resilience by accelerating the transformation of our economy so that promises are fulfilled for the benefit of this nation. They have mapped out their strategy and will be walking their talk as their mission has been outlined. What is your decision, Malaysian?