Malaysian Prime Minister Ismail Sabri Yaakob (Photo: Reuters)Kuala Lumpur (VNA) – The Malaysian government will target a goods andservices tax (GST) rate that does not burden the people but is not so low thatit “defeats the purpose of expanding tax revenue”, Prime MinisterIsmail Sabri Yaakob has said.
Malaysia is facing inflationarypressures due to rising food prices and cost of living.
The central bank ofMalaysia forecasts that inflation will be between 2.2 percent and 3.2 percentthis year. Earlier this month, the bank announced unexpectedly raised keyinterest rates to cool down inflation pressure.
The government has adopted price controls, but the cost of subsidies has placed a heavy burden onthe state budget.
The country is projected to spend 28billion ringgit (7 billion USD) on fuel subsidies in 2022 alone, more than doublethe 11 billion ringgit of last year, in addition to subsidies for cooking oil,sugar and flour .
In 2015, theleadership of the United Malays National Organisation (UMNO) party proposed the application of a new GST, however, three years later Mahathir Mohamad's administration rejected it after voters blamed the 6 percentconsumption tax for rising cost of living./.
