Saturday, May 15

PSB moots SST exemptions in proposed second stimulus package


KUCHING: Parti Sarawak Bersatu (PSB) has urged the government to consider giving exemptions for the Sales and Services Tax (SST) for an extended period of time due to the tough economic situation, which is compounded by the Movement Control Order (MCO).

In a statement issued today, PSB said the roll out of a second stimulus package is urgently required and that it should include exemptions or reduction of Sales and Service Tax (SST).

PSB pointed out that SST is a single stage tax which is embedded in the final costs of products, and a reduction in taxes would improve business conditions as well as increase the disposable income of the rakyat.

“SST hit the lowest income group the hardest because these people would not be subject to income tax at their income level but are forced to pay SST even if they earn zero income.

“A reduction or exemption from SST of certain classes of goods would greatly benefit the lowest income group who need help the most in this unprecedented crisis.

“Last year, the government collected RM27.5 billion in SST revenue which surpassed the targeted RM22 billion,” the party said.
The Sales Tax and Service Tax were implemented in Malaysia on September 1, 2018, replacing Goods and Services Tax (GST). A standard rate of 10 per cent is applied under Sales Tax and six per cent for Service Tax.

“A reduction in the SST would go a long way to help the rakyat especially the lower income group during these tough economic times,” PSB said in the statement.

On Monday night, Prime Minister Tan Sri Muhyiddin Yassin announced the implementation of the MCO from yesterday until the end of this month to stop the spread of the Coronavirus Disease 2019 (Covid-19).

Under the order, all business premises are to close, except for those providing essential services and eateries, which can only provide takeaway or home delivery services.