GST: Sabah not ready

Kota Kinabalu, 21 Dec 2009: Prices of goods and services all over Sabah would increase with the implementation of the Goods and Services Tax (GST).

Sabah Progressive Party (SAPP) Secretary General Datuk Richard Yong said prices of goods and services statewide, in particular, at rural areas are already higher and it could increase further the implementation of the GST.

The intended GST replacing the sales and services tax applies to everyone, the wealthy and the poor. Once imposed would definitely caused inflation and hike in prices of goods and services much similar to the effect of hike in petrol price.

The sales and services tax only applies to the rich at urban areas while the poor at rural areas are exempted.

Sabah being the poorest State in the whole of Malaysia, having the lowest income per capita yet has to cope with the highest cost of living.

"The most worrying thing is prices of goods and services at rural areas, which already costly as compared to other areas nationwide would be even higher and causing the poor folks over there to suffer further," he said in a statement, here, today.

He said the imbalances in terms of development, the lesser infrastructure, poor condition of roads and bridges has caused higher transportation costs, here.

The Cabotage Policy has cost of shipping to Sabah comparatively much higher. All these costs were passed on to the people of Sabah, the consumers, Richard said.

"All these have to be corrected first before the government even consider imposing the GST in Sabah," he added.

Second Finance Minister Datuk Seri Ahmad Husni Hanadzlah had said in Ipoh, Perak on Dec 19 that the implementation of the GST is a means of placing the country's economy at a level that is at par with those of developed nations and in keeping with changing times.

Ahmad Husni said the GST implementation gave the government an advantage,particularly in enhancing income flow, which can then be used to implement projects for the benefit of the people.

Only three countries in the South-East Asian region do not practice this taxation system, that is Malaysia, Brunei and Myanmar.

Brunei does not have a taxation system

Ahmad Husni added that Malaysia will join 143 other countries in implementing the GST.

Ahmad Husni said the GST system to be introduced by the government is at four per cent to replace the sales and service tax at between five and 10 per cent at present, to increase the effectiveness of the country's revenue collection.

Richard said the Federal Government wants to put Malaysia to be at par with the other developed countries in terms of taxation and economy, but has overlooked that Sabah, which is not even at par with the other States in Malaysia in many aspects.

He said the most glaring example is the health care services in Sabah, which is getting worse where each doctor is serving more than 1,000 people.

He added that the doctor per population ratio was one doctor for 400 people few years back.
He said it is better if the Federal Government try to put Malaysia at par with some developed countries in terms of control of corruption.