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GST: SMEs need to spend up to RM4 billion for computing systems

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SHAH ALAM, 3 Nov: Small and Medium Enterprises (SMEs) in this country would have to spend about RM3 billion – RM4 billion to implement a computerised system for the Goods and Services Tax (GST) which will be imposed starting from 1 April 2015.

The Member of Parliament for Bayan Baru, Sim Tze Tzin, said that it is a huge cost to be shouldered by the people and our country especially since the effectiveness of the GST is still being disputed.

He said that due to the high cost, companies will shift costs to consumers, causing an increase in goods and services, as well as an increase in the rate of inflation.

“Currently, only RM100 million goes to computing systems and this does not only involve the government system, but the people, especially small and medium businessmen, have to spend between RM20,000 to RM80,000 for a new system.

“In terms of the people, they need to spend a lot for the GST, while the large companies have to spend hundreds of thousands for the GST,” Sim said when contacted by TVSelangor.

He said the projected cost is based in other countries’ experiences in implementing the GST when SMEs need large expenditures to upgrade existing computer systems.

Previously, Prime Minister Datuk Seri Najib Razak said that Putrajaya will spend RM98.8 million to implement a computerised system for the GST.

Najib said that the Customs Department, as the implementing agency, will reorganise staff and personnel in preparation for the implementation of the tax.

Sim said that the computing cost if almost RM100 million for the GST which is to be shouldered by the Central Government is also feared to increase and lead to wastage if not controlled.

He said that the Federal Government is implementing the GST in a hurry while no incentives are given to SMEs to upgrade their computing systems.

“Therefore, millions of ringgit is needed just to implement the GST,” he said.


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