PKR today challenged Prime Minister Najib Abdul Razak to take a bold step and announce the implementation date for the goods and services tax, in order to make the next general election a referendum for the new tax.
Speaking at the party headquarters in Petaling Jaya this morning, the party’s chief of strategy Rafizi Ramli (right) said that this is in line with global practices.
“The issue was made the main election issue in most countries which implement the GST, and the election result a referendum on whether the people agree with its implementation,” he said.
According to Rafizi, a strong mandate is required for such a tax as it would affect all Malaysians, including those whose incomes are lower than the taxable threshold.
“The people deserve a confirmation from the PM; if they vote for BN in the next general election does it also mean they are voting for a new tax?” he asked.
Najib had earlier this month said that the GST is likely to be implemented after the general election, as the government needs time to ensure buy-in from the rakyat.
Commenting on this, Rafizi said that Najib’s latest statement on the GST is still not enough to show that the government will indeed implement the tax.
“His commitment (to the tax) is vague…just like (former premier) Pak Lah. Both say they will implement it,” he said.
Beyond giving voters the runaround, Rafizi added that “beating around the bush” on GST is also not doing the business community any favours.
“It is even worse for the business community. They need eight to 12 months to prepare for the GST, and if the government continues to dilly-dally, they will keep on paying for readiness costs.
“Najib has to be brave. If he believes GST is the key to overhauling the economy then say it: ‘If we win, by Aug 1 we will implement GST’,” he said.
Nevertheless, Rafizi said that the government is not being truthful to the people if it insists that GST is able to solve the country’s deficit issues.
“At the four to five percent proposed, total collection is only RM6 billion, and that will not be enough to cover our deficit which stands at about RM40 billion.
“It will take a while for (GST) to cover the deficit, unless it will be four percent the first year, seven percent the next and 15 percent the year after,” he said.
He added that while Pakatan Rakyat is not in principle opposed to the GST, which he admits is an efficient tax, the coalition believes controlling leakages and better collection of corporate taxes are better solutions in raising revenue.
Rafizi also noted that implementing the GST at a time when only 1.7 million people earn enough to pay income taxes also runs counter to the government’s move to address cost of living issues.
“GST will only add to the cost of living at a time when inflation is on the rise,” he said.
Cost of living survey by PKR Youth
Meanwhile, PKR Youth announced that the wing will be conducting a nationwide survey to gather data on cost of living among youth.
“This is because youth are the most affected by inflation, as they have to service car loans, student loans and mortgages at entry level wages,” Rafizi said.
According to Youth chief Shamsul Iskandar Md Akin (left), the survey targets a sample size of 1,000. PKR Youth members will be conducting surveys at major transportation hubs in Kuala Lumpur and every state in Malaysia on Oct 1 and 2.
The survey will also be available online on the PKR and PKR Youth websites.
The areas of focus will be career opportunities, effects of PTPTN and private student loans, housing, minimum wage and taxes and duties on car purchases vis-a-vis the national automative policy.
“We expect to present the results as supporting data for the Pakatan alternative budget which will be presented on Oct 4, before the Budget 2012 is table at Parliament on Oct 7,” he said.
Asked if the survey has been left to the last minute, Shamsul Iskandar disagreed, saying that the purpose is to “enhance and strengthen independently collated data already available”.
The results and the alternative budget will also be presented in forums which will take place throughout October.