lower percentage of GST for Sabah and Sarawak

KOTA KINABALU: Implementing the Goods and Services Tax (GST) is only fair under ‘one country one price’ situation, or else people in Sabah will end up paying more than our counterparts in Peninsular Malaysia due to the higher cost of goods here.

Federation of Sabah Manufacturers Association (FSM) president Datuk Seri Panglima Wong Khen Thau suggested the government impose a lower percentage of GST for Sabah and Sarawak if they decided to implement the proposal.

Wong pointed out that the goods in Sabah were 20 to 30 per cent more expensive than the peninsula, thus the seven per cent GST paid would certainly be higher than our West Malaysian counterparts.

Furthermore, people in the Interior will suffer more as the goods there were more expensive, he said when contacted yesterday.

If the government really wants to implement the GST, Wong suggested the government impose seven per cent in Kuala Lumpur, four to five per cent in Sabah and probably three percent in the Interior.

He said implementing GST of seven per cent would rake in an additional income of up to RM27 billion for the government, as stated by Minister in the Prime Minister’s Department Datuk Seri Idris Jala.

He said it was implemented in most developed countries.

“But Malaysia is a third world country, it will only be fair if we have ‘one country one price’, like Singapore and Australia.”

In this respect, Wong pointed out that the government has to balance the price differentials between Peninsular Malaysia, Sabah and the rural areas. He said it was a good policy so that people could not evade tax but it had to be fair to everyone.

Whilst the GST would affect consumers, Wong said it would indirectly be good for manufacturers or some in the business community as manufacturers no longer had to pay sales tax.

Wong added that it was not known yet how the government would implement the GST or whether there would be differential in percentage. However, FSM had submitted a memo to the government some time ago highlighting the issues affecting Sabah as well as suggesting recommendations.

--THE BORNEO POST

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Sabah In Right Direction Under BN

Sabah is moving towards the right direction as far as manufacturing and other contributing business related sectors are concerned. With all its good planning, well-deserved strategies, and a total investment of some RM4.8 billion, it has placed Sabah as the second largest investing state in Malaysia, after Selangor.

Federation of Sabah Manufacturers (FSM) President Datuk Seri Panglima Wong Khen Thau, disclosed that it has not been a bed of roses for the manufacturing sector, as they faced a lot of challenges over the years, but he was positive that the close rapport and relationship with the present government, has helped them to move ahead towards greater heights.

"Sabah's economy is fast developing, especially under the present government. Manufacturing is also one of the Halatuju (the other two are tourism and agriculture), and we believe that the industry had benefited a lot under the leadership of Chief Minister Datuk Seri Panglima Musa Aman. The government has been friendly and positive towards the manufacturing sector.

"Although we face a lot of challenges, all of them are beyond the capacity of the State Government to resolve. And in fact, these challenges have been there for decades," he said.

"But in the past few years, we see some light at the end of the tunnel, something is working more positively and it is a good sign and a fruit of the close cooperation between the State Government and FSM," he said.

As a result of close cooperation with the government and the positive relationship, FSM was able to resolve some of the major issues that have been burdening the manufacturing industry itself, such as land matters.

"For the past three decades, we have resolved at least 90 per cent of the land issues, and we have less than 10 per cent more to go," he said.

He said the Federal Government recently promoted the Small and Medium (SME) Master Plan, which is comprehensive plan designed to help the SMEs to grow. SMEs, he added, contributed over 90 per cent of the business sector.

In 2010, SME's contribution to the Gross Domestic Product (GDP) was 41 per cent, employment (62 per cent) and export estimated at 19 per cent. Based on these numbers, Wong is optimistic that by 2020, the numbers would grow to 41 per cent (contribution to GDP) and employment (62 per cent).

--NEW SABAH TIMES

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