The Penang chief minister said the island republic’s move confirms the worldwide trend for the tax’s rate to increase once it had been imposed.
He said the only solution to prevent the rate from going up was to terminate the tax.
“This is what Pakatan Harapan is promising, to abolish GST within the first 100 days of taking power, and restore the previous sales and services tax (SST),” said Lim, who is PH deputy president.
He said PH and PPBM chairman Dr Mahathir Mohamad had refused to impose the GST when Malaysia faced an economic crisis during his tenure as prime minister from 1981 to 2003.
He claimed that this was because Mahathir knew the “adverse” economic impact of GST on poor and small businesses.
In a statement today, Lim said the Barisan Nasional (BN), on the other hand, continued to laud the GST as being necessary for the country.
“By supporting BN, GST will not only be retained but is likely to be increased in future,” he claimed.
The GST was implemented in Malaysia in April 2015 at a rate of 6%, which has remained till today.
Singapore had introduced it in April 1994 at the rate of 3%, which was later progressively raised to the current 7%.
Yesterday, Singapore’s Finance Minister Heng Swee Keat announced in the annual national budget speech that the rate would be hiked to 9% sometime between 2021 and 2025.
Lim claimed that Malaysia’s move to start the GST at the rate of 6% had caused “economic dislocation and cost-of-living disruption” among ordinary people.
“Singapore can afford to implement GST because it is a high-income economy with a GDP per capita 5.6 times more than Malaysia,” he said.
“That is why the poor and small businesses are worse off in Malaysia as compared with Singapore,” he added.
See-To: Guan Eng’s call to follow Australian GST model simplistic