Finance Minister Lim Guan Eng has stated that not all products and services will be imposed with the sales and service tax (SST), which is set to be reintroduced on 1 September this year.
The statement by Lim sad that SST will be imposed to selected manufactured and imported items, which will carry two different rates: 5% or 10%.
“The 6% service tax applies to selected services and not all services, unlike the goods and services tax (GST),” he told The Edge.
Lim also told The Edge that the sales tax is imposed on manufacturers’ and importers’ price, while GST was imposed on the final consumer price and it is not correct to claim that the 10% sales tax is higher than the 6% GST.
“How could the SST burden the people more than the GST when the expected collection from the SST is estimated at only RM21 billion for a full year, while the GST had expected to collect RM44 billion in 2018, according to the previous government’s projection,” he added.
The Finance Minister also mentioned that the new SST is designed in a way that the impact towards the lower income group would be ‘proportionally less’. Further details will be made known when the SST Bill is tabled at the Parliament.