KUALA LUMPUR: The list of zero-rated and exempted items under the Goods and Services Tax (GST) is "too long and troublesome", said Deloitte Tax Services Sdn Bhd managing director Yee Wing Peng.
"The government should be firmer and keep the list of GST-free items short," he told a media conference at Deloitte TaxMax Budget Seminar, a full-day forum organised by Deloitte Malaysia today.
Comprising over 900 items, Malaysia's GST exemption list is said to be the longest in the region.
According to Yee, the long list means there will be less revenue collected by the government, while businesses will also find it difficult to comply with the new tax regime.
"We have too many items with different GST treatment. It would be very troublesome for businesses and confusing for consumers. I hope the government can streamline the list," he said.
RHB Investment Bank Bhd director and regional head of equity capital markets Gan Kim Khoon concurred.
"We have to decrease the number of items in the GST exemption list," he said.
Deloitte's Yee highlighted that in New Zealand, all products are subject to GST on one single treatment, whereas in Singapore, financial services are among the few items that are out of the scope.
He added that petrol should be taken out from the GST exemption list as it could encourage smuggling, particularly to Thailand and Indonesia, two of Malaysia’s neighbours that have imposed the value-added tax (VAT) on petrol.