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Government Rules Out GST Reintroduction Amid Petrol Subsidy Speculations

Business Today ·  Aug 29 02:14

Communications Minister Fahmi Fadzil has firmly denied any plans to introduce a broad-based consumption tax, specifically the Goods and Services Tax (GST), as an alternative to removing subsidies for RON95 petrol. Addressing the rumours, Fahmi clarified that there have been no discussions on the matter.

"There were never any discussions," Fahmi stated briefly when asked by the press after attending the full dry-run session of the 2024 National Day Celebration at Dataran Putrajaya today. His remarks were in response to a recent article by an online media outlet, which claimed that the government was considering reintroducing a broad-based consumption tax instead of cutting subsidies for RON95 petrol as a way to strengthen its finances.

The article, citing sources familiar with the situation, alleged that the Cabinet had discussed the potential reintroduction of GST, arguing that it might be politically easier than removing petrol subsidies, particularly given Malaysia's status as an oil producer and the public's perception of affordable petrol as essential.

In a related development, Economy Minister Rafizi Ramli also weighed in on the topic, stating that Malaysia is not inclined to reintroduce the GST as a means of boosting revenue, despite recommendations from the Organisation for Economic Co-operation and Development. "There are many ways to achieve fiscal strengthening, with different groups offering varying perspectives," Rafizi commented earlier this week.

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