SHAH ALAM, 12 Nov: The Central Government has been suggested to implement the Capital Gains Tax (CGT) to replace the Goods and Services Tax (GST), which will be implemented on 1 April 2015, because it is able to provide revenue for the government and not burden consumers.
The Communications Director for the Federation of Malaysian Consumers Associations (FOMCA), Mohd Yusof Abdul Rahman, said that however, the implementation of the CGT requires more in-depth studies and analysis by economists.
He said that the study is important to ensure that the decision made will not burden the people, who are becoming increasingly pressed with the cost and burden of living which is increasing every year.
“If it is found that the CGT is better, then implementation should be considered to replace the existing tax system.
“We understand that the government needs a source of income to develop the country.However, we want to implement it in a way that does not to burden the people,” said Yusof, when contacted Selangor now.
The CGT would mean that tax is imposed on profits from the sale of assets such as shares, bonds, property, gold and so on.
Currently, the government is only imposing the CGT on profits from the sale of property which is also called the Real Property Gain Tax (RPGT).
He was commenting on the proposal by Economic Analyst, Azrul Azwar Ahmad Tajudin, for the Central Government to implement the CGT to reduce the burden of poor people from being further squeezed by the GST.
Commenting on the implementation of the GST, Yusof suggested for the Central Government to reconsider the six percent to be imposed so as to not dramatically affect consumers.
“I think that the GST, as a new thing in Malaysia, should be introduced at a lower rate; which is about three or four percent, as practiced by our neighbouring country, Singapore.
“This is important so that the people or consumers are not dramatically affected by the implementation of the six percent tax,” Yusof said.