MCA has proposed that the government consider reinstating the Goods and Services Tax (GST) only after current global conflicts subside, calling for a phased, multi-year rollout rather than a sudden policy shift.
Its Vice President Datuk Ir Lawrence Low said any reintroduction must be carefully planned over two to three years, with 2026 dedicated to groundwork and planning, followed by further preparation in 2027 before its potential implementation in 2028.
“You cannot have a sudden or drastic implementation; you need time,” Low told BusinessToday, noting that businesses are still adjusting to the expanded Sales and Services Tax (SST) and e-invoicing requirements.
He added that a lower initial GST rate, around 3% to 4%, could be considered to ease the transition, instead of reverting immediately to the previous 6% rate.
Low emphasised that GST is a more transparent and efficient tax system compared to SST, which has been adopted in over 170 countries globally.
“Any tax system that benefits the country should be considered. We should put aside political issues and adopt policies that are good for the rakyat,” he said.
While acknowledging concerns over revenue impact from a lower GST rate, Low said this should be assessed by the Finance Ministry, adding that GST historically generates significantly higher revenue compared to SST due to its broader tax base.
Commenting on Prime Minister Datuk Seri Anwar Ibrahim’s view that GST should only be reintroduced when Malaysia reaches a minimum wage of RM4,000, Low said such a benchmark may not be necessary, noting that several neighbouring countries have already implemented GST at lower income levels.
He stressed that GST is widely recognised globally as a transparent and fair tax system with broader coverage, where taxation is applied based on consumption.
“It is a phased and structured tax system that ensures those who spend more contribute more,” he said, adding that segments of the business and corporate community have already begun calling for the reimplementation of GST.
Overall, Low’s call comes as Malaysia continues to balance fiscal sustainability with cost-of-living pressures, with any potential tax reform likely to remain a closely watched policy debate.
