Jumaat, 27 Oktober 2017

Don't be surprised if Pakatan U-Turns on GST too.

Press Statement

1. While I agree with the Prime Minister and others who had criticized Pakatan's shadow budget as unsustainable, unrealistic and full of contradictions, several items in their shadow budget stands out.

2. For many years, Pakatan had long criticized the BN Government's removal of blanket subsidies for petrol prices in order to reduce wastage, curb smuggling and reduce unsustainable and inefficient subsidies.

3. Although the headlines of their shadow budget says that they will introduce a 20sen per liter subsidy for petrol, the fine print in there says that it is only limited to motorcycles and cars below 1,000cc as it wants the subsidies to be targeted. Pakatan says that only Malaysians with a valid MyKad will benefit from this subsidy.

4/ No mention is made of what is the cost of the implementation of this system or how it will be enforced. However, this is a clear indication that Pakatan now agrees with the BN Government's bold but necessary decision to eliminate blanket fuel subsidy was the correct decision for the nation..

5. This is a massive U-turn from their long-held stand and a betrayal to their many supporters who have gone for the many rallies organized by them calling for a return of blanket fuel subsidies.

6. Another item in Pakatan's budget states that they will not restore subsidies for sugar based on health reasons.

7. I am sure many remembers the many attacks by Pakatan leaders on the BN Government when sugar subsidies were completely abolished just 4 years ago in 2013.

8. Pakatan had rejected BN's reason then that the removal of this subsidy is due to high diabetic and obesity rates among Malaysians but instead accused the BN government of being cruel to the people or guilty of cronyism.

9. But now Pakatan is using the exact same reason that they had aggressively rejected from BN then. This is yet another example that BN's bold decision, although politically unpopular then, was made in the best interest of Malaysians.

10. In another U-turn from their promises in the past, Pakatan now says they will no longer abolish PTPTN and cancel all the student loans - a move that BN and civil society had long criticized as irresponsible and sends the wrong message.

Again, Pakatan's U-turn proves that the BN Government was right all along to promote responsible behaviour.

11.  Although the headline says that Pakatan will abolish GST, this is incorrect, according to their shadow budget. They have stated that on top of re-introducing the 10% Sales Tax and 6% Service tax regime, Pakatan will still maintain the existing GST system and reporting system but reduce the 6% rate to zero.

12. On top of maintaining the GST system, re-introducing the sales and service tax, Pakatan's shadow budget had also proposed increasing personal income taxes, introducing Capital Gains Tax and Inheritance taxes.

13. Pakatan had long claimed that management of the GST system was complicated and a burden to small businesses  - alleging that this has caused many small businesses to close down.

14. Despite this, Pakatan still wants the businesses to continue the GST tax system on top of the additional sales tax and service tax.

15. This means that even if Pakatan wins and the GST is reduced from 6% to 0%, they can at anytime later on, and literally at the flick of a switch, increases the GST back up to 5%, 6%, 7% or even 10% since the GST system is still running and not abolished as they claim.

16. Given the many U-turns already made on key controversial items I listed earlier, it will not be a surprise that Pakatan will also U-Turn on "abolishing" GST should they come into power.

17. At that time, they will be praising the GST system as an efficient and fair tax system that will make Malaysia more competitive  and that Malaysia must have GST  just like the other 168 countries in the world who already have a GST system.

18. Malaysians are advised to treat Pakatan's promises with a big dose of sceptisim as they are masters of U-Turn and hate propaganda. After all, it was Pakatan who taught us that a manifesto is not a promise - and neither is a shadow budget.

Eric See-To.
Deputy Director,
Barisan Nasional Strategic Communications.

26th October 2017