GST IMPLEENTED

1. Challenges And Impact In Implementing
Good And Services Tax In Malaysia
• PREPARED FOR:DR.MUSTAPA
• PRESENTED BY: NUR NAJIHAH ABDUL RAHMAN
:…………………….

2. Outline of presentation
Background of the topic Significance of the topic
Challenges of implementing
GST in Malaysia
Discussion / synopsis on GST
from Malaysian Budget 2015
The issues and impact of GST:

3. Overview of GST
 What is GST?  GST Supplies Model
 Classification of Items

4. History of GST/VAT
 Who earlier introduce
 Countries that implemented
GST/VAT

5. Overview of GST :What is GST ? ?
Goods and services tax (GST) is
a form of tax levied on
spending will be implemented
on 1 April 2015
GST is tax on what is
spent and not on what
is earned.
GST(6%) is not a new tax-as
replacing the existing
of Sales Tax and Service
(10% & 6%

6. Overview: Classification of GST
Zero-Rated Items Exempt item
• Agriculture products – paddy & various fresh
vegetables
• Beef, mutton, swine
• Fish, salted fish, prawns, cuttlefish, crabs, oyster
etc.
• Rice, sugar, table salt, plain flour, cooking oil
• Selected poultry and eggs
• Water for domestic use
• First 200 units of electricity (domestic use) for
minimum 28 days
• Exported goods and services
• Selected services related to exports
• Public transportation – rail, bus,taxi (excludes
luxury/airport taxi)
• Tolled highway or bridge
• Land for residential, agriculture or general
use
• Funeral-in-a-package
• Private healthcare & education
• Selected financial services
• Childcare services
• Selected accommodation (28 days or more)

7. Overview: Malaysia GST’s Supplies Model

8. Overview: GST Supplies Model
GST referred to “taxable” items and “exempt” items
 “standard-rated”(taxable supply), - category where
suppliers who are GST-registered will collect 6% GST from
customers
 zero-rated” supply(taxable supply)- which carries 0% -make
wholly zero-rated supplies, then it is likely that you will be
in a refund position with Customs.
 exempt” supply - which does not attract of GST. you will be
not refund position with Customs.

9. a) GST-Standard Rate supplies (6%)

10. • 1-Manufacturer of Television produced LED Television and sell in a bulk to the
wholesaler.
• 2- Wholesaler need to pay =RM1000+ 6% GST(RM60)= RM1160
• 3-Wholeseller sold the TV to the retailer with the price RM2000 per unit. RM2000+
6%GST(RM120)=RMRM2120
• 4-Retailer would sell the unit of television to the consumer with the price
RM4000.RM4000+ 6%GST(240) =RM2240
• 5-Overall consumer paid RM4240.And the GST that need to pay is total RM240

11. b) GST-Zero Rate supplies (0%)

12. c) GST-Exempt rate (0%)

13. Principle of GST
Multi Stage Tax
Businesses Bear
Compliance Burden
Broad-based Tax
Tax Neutral to
Business

14. History of GST/VAT
• VAT was invented by the French in 1954
• Goods and Services Tax also known as the
Value Added Tax (VAT) or Harmonized Sales Tax
(HST) was first introduce by a German
economist during the 18th century
• In 1954, the tax was finally adopted by France.
Maurice Lauré , Joint Director of the French Tax
Authority, was the first to introduce VAT on
April 10, 1954.

15. Countries Implemented
No. Region No. of Country
1 ASEAN 7
2 Asia 19
3 Europe 53
4 Oceania 7
5 Africa 44
6 South America 11
7 Caribbean, Central & North America 19

16. Asia :Singapore
Year GST Rate
1 Apr 1994 to 31 Dec 2002 3 %
1 Jan 2003 to 31 Dec 2003 4 %
1 Jan 2004 to 30 Jun 2007 5 %
1 Jul 2007 onwards 7 %

17. Singapore
• Introduced a GST in April 1994, paired with a
reduction of direct and other indirect taxes
• Restructuring of the tax system began with a GST
rate of 3 %
• Today, Singapore’s GST rate is 7 % - its last revision
was in 2007. The introduction of a GST in 1993 is
simultaneous with the various package offset

18. Europe Country: Australia
 GST known as output VAT(ouput tax to producer),and input
VAT (tax that paid by company after received the good
 Australia, the idea was first floated in 1975. Australia imposes
flat rate on goods and services and replaced a range of
existing taxes
 Lower income group also get the rebate from paid of the GST

19. Recommendation
Government should created more items under
zero rate supplies rather than exempt rate
supplies.
Why not we just improved the earlier tax that we
had, (SST tax) rather than imposed new one?
Malaysia should provide continuous and many
more paying offset to lower income group like
practised in Singapore

20. • THANK YOU FOR LENDING YOUR EARS