Le101 Basic Writing And Study Skill

Topics: Tax, Progressive tax, Value added tax Pages: 9 (1669 words) Published: November 20, 2014

School of Business Management
LE 101 Basic Writing and Study Skill

Topic: Implementation of GST in Malaysia

Name: Cheah Ying Qi
Student ID: B 1308101003

Lecturer: Ms. Peggy
Table of content

Introduction of GST
implementing of GST
Advantages of implement GST
Disadvantages of implement GST

What is GST? The idea of introducing a flat consumption based Goods and Services Tax (GST) in Malaysia has been floated since 1989. GST was first announced in the 2005 Budget for implementation in 2007. However, in February 2006 the Malaysian Government announced that GST would be deferred as more time was needed to get feedback from the public. After that, GST was tabled for first reading in 2009 for proposed implementation in 2011. The bill was supposed to be presented for second reading in 2010 but was withdrawn. Finally, on the 25th of October 2013, Malaysian Prime Minister Datuk Seri Najib Razak announced the introduction of the Goods and Services Tax (GST) in Budget 2014 to replace the current sales and services tax, GST will be effective on April, 2015.   Consumption (GST) is the government to the taxable items and Tax service, including all imported goods and services, all registered manufacturer as government assistance to the taxpayers to impose consumption Tax. For Malaysia, to impose consumption tax is a new tax, to replace the existing business tax and service tax (SST). Compared with the existing business tax and service tax, consumption tax is a broader concept, it will be for production and service-oriented business tax together at the same time, makes our country's tax policy unification, to facilitate the government's tax reform. From the current information we have known that government is forthcoming consumption tax rate is 6%, will be lower than now, the business tax rate (10%) and the service rate (6%). Consumption tax is conducted by the royal Malaysia customs management, responsible for the registration of the consumption tax, will be regarded as a consumption tax registrant, the proposed line of mandatory registration threshold, and might be earning more than 500000 ringgit. Mainly includes the input tax and consumption tax output tax. Income tax refers to the pay sales tax when buying goods and services; Output tax refers to charge sales tax in business sales. Implementation of GST

The practice of the consumption tax to say has accumulated extensive experience. Malaysia can get more experience of other country, so that GST can have the high chance to success. In the past years, the consumption tax or VAT is regarded as the main tax system. The total of more than 160 countries currently carrying out the tax system. In many countries because not satisfied itself of consumption tax, thus promote the consumption tax or value added tax (VAT). The factors that people not satisfied are the current consumption tax are properly, find alternative tax system for the lower tax rates and the current tax system can't cooperate with the development of economy. In Malaysia, our tax system includes several different indirect taxes, such as Import Duty. The Import Duty will be tax, when brought on domestic goods. Besides that, the Export Duty will be tax when commodity production sales abroad while consumption tax or Excise tax will be tax when buying luxury goods and "sin taxes" products, such as cars, white wine, beer and tobacco products. After that, the government tax service will be tax on most of the imported goods or manufacturers refer to different tax rate of 5%, 10%, 20% and 25% and Services tax will be tax on restaurants, hotels, telecommunications services, professional services, architects, engineers, lawyers and other services. So that, the proposed GST tax will replace the existing sales and service tax. In Malaysia, GST by the government in the...

References: 1. http://www.internationalconference.com.my/proceeding/icber2014_proceeding/5thicber_proceeding/041_148_5thICBER2014_Proceeding_p569.pdf
2. http://en.wikipedia.org/wiki/Goods_and_Services_Tax_(Malaysia)
3. http://gst.customs.gov.my/en/Pages/default.aspx
4. http://www.nbc.com.my/gst/faqs-malaysia-goods-and-services-tax-gst/
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