(May 11): Penang ratepayers will not have to pay the goods and services tax (GST) to local councils for using services such as parking and rental for council-owned hawker stalls, halls, land, buildings and other facilities.

Chief Minister Lim Guan Eng said the Penang Island City Council (MBPP) and Seberang Prai Municipal Council (MPSP) will be absorbing the consumption tax beginning July 1.

He said MBPP would absorb about RM1.2 million while MPSP would absorb about RM863,000.

"The state exco has decided to have the local councils absorb the tax. We will just have to find a way to get the money.

"(We have to) 'ikat perut' (tighten our belts)," he told a press conference at the state legislative assembly building today.

Penang's move to have the local councils absorb the GST comes after a similar move by the Johor government and local council, after Johor Sultan Ibrahim Sultan Iskandar ordered the Johor local authorities to absorb the tax.

Lim said while MBPP and MPSP absorbed the tax, the state government would continue to ask the federal government to exempt the tax from local councils.

"We have already written to the prime minister on the matter but there has yet to be a reply.

"We will continue to write to Putrajaya on this," he said.

Lim also urged all state governments to apply for the exemption from Putrajaya as they were running services for the benefit of the people and not after making profit.

The Penang government has been against the implementation of the 6% GST, which was imposed on April 1. – The Malaysian Insider