KUALA LUMPUR (July 17): Rembau Member of Parliament Khairy Jamaluddin today appealed to the Pakatan Harapan-led government against scrapping the goods and services tax (GST) for political reasons, in a last ditch effort to stop the three-year-old consumption tax system from being replaced with the sales and services tax (SST) on Sept 1.

Rather than scrapping the GST, the government can lower the rate, the opposition lawmaker said.

Khairy said he will raise this subject matter during the debate session of Parliament, as he is of the view that the SST is not as efficient as the GST.

“I will touch on this matter during the debate session, where from a tax system perspective, (for it) to be efficient; the government does not need to abolish the GST and reintroduce the SST, as the latter is an inefficient tax system. (With the SST,) there will be (revenue) leakages, that has happened before and that was why we introduced the GST (in April 2015)," he told reporters at the Parliament’s corridor after the royal address by Yang di-Pertuan Agong Sultan Muhammad V today.

“I will make (a) more detailed proposal during the debate session, where the government can maintain the GST, but (probably) fix it at a lower rate than 6%, while getting similar revenue like what will be obtained from the upcoming SST,” he added.

In his Twitter post today, Khairy said the government should approach the GST issue rationally. “Am aware GST is (a) big political issue for government, but they must approach the issue rationally. Don’t scrap GST because of politics. Adjust the rate, so it is revenue neutral to your SST. Don’t let politics determine economic policy,” he added.

Yesterday, Finance Minister Lim Guan Eng announced that the SST will be implemented from Sept 1, with a 10% tax on sale of goods and 6% tax on services.

Earlier in his royal address, Sultan Muhammad V expressed his support to the government’s various initiatives to lighten the people’s cost of living, including zero-rating the GST.