Chambers president Hong Yeam Wah said the rate of the consumption tax, which was zero-rated from 6% as part of an election pledge by Pakatan Harapan last year, should start at 2%.
Hong said this can be increased gradually in tandem with the performance of the economy.
He said GST was a “tried and tested” system in over 100 countries.
As long as companies can claim refunds, the tax is fair to all in the supply chain, he added.
In contrast, the sales and services tax (SST) only affects manufacturers, he said.
“GST is fairer as it allows everyone to contribute to the government’s coffers.
“The concept is great, but the earlier 6% imposed proved to be too high for some. We ask the government to roll back to GST, but start off with 2% and go slow on increasing it,” he said.
GST, introduced in April 2015 at 6%, was replaced with SST on Sept 1, 2018.
On Wednesday, the Malaysian Institute of Economic Research (MIER) said Putrajaya could re-introduce the tax in the 2020 Budget at a lower rate of 3%.
MIER chairman Kamal Salih described GST as fair to everyone, adding that the tax regime had kept the government afloat when crude oil prices declined to below US$36 per barrel in 2015.
Prime Minister Dr Mahathir Mohamad, responding to MIER’s proposal, said the government could bring back GST “if that is what the people want”.
The Penang chapter of the Federation of Malaysian Manufacturers (FMM) said its members have no problem with reverting to GST.
Its chairman Ooi Heng Hock, however, said as factories had just implemented the SST system, they would require some time before their accounts could accommodate GST.
“Generally, we are supportive of any system that would help in the recovery of the country’s economy. If GST is found to be useful, we will fully support it,” he said.
One employer told FMT that implementing GST would mean the foreign worker population in the country paying tax to the government.
“The six or seven million foreign workers have been on a tax holiday ever since the GST was repealed,” said the factory owner who declined to be named.