Are Malaysians ready for GST in 2011? No.

Are Malaysians, in general, ready for the Goods & Services Tax (or otherwise known as GST) in 2011?

No, according to the ACCCIM - Associated Chinese Chambers of Commerce & Industry of Malaysia.

The ACCCIM 2010 SME's Survey sent out a questionnaire to 2000 SME's but only 1250 returned their questionnaire paper.

Out of these, 33% said their business were not prepared for the GST implementation due to a lack of information from the government.

About 80% of the respondents said their computer systems were not ready to cater to the GST system.

What can we infer from the findings?
1. The Malaysian Government must strenghten its efforts to educate the public so that they will have a positive view of the GST

2. The government should draw up a clear timetable and give the public sufficient time to prepare for GST implementation

3. The Government should consider giving out incentives to encourage companies to switch to GST systems. Note: The Singapore government gave out a rebate of SGD 5,000 for companies that bought new software and hardware systems that are GST compliant.

4. In the meantime, all companies concerned should take the initiative to source for new computer systems that can track the GST payable, and GST collectible, so that they will not lose out when the GST is introduced.

My one sen worth
The ACCCIM said that 2012 is the right time to introduce GST as 24 months time frame is necessary to get the public to be ready for GST. However, it is like setting a moving target. Come 2012, the companies will also not be ready. The GST idea has been mooted since 2005, and was supposed to be introduced on Jan 1, 2007. And still, people are not ready.

I think the government should bite the bullet, and take the strong commitment to explain the exact workings of GST, and how it will affect the consumers. Do not skirt around the issue, and say that it will be good for the country's economy. Explain that only a handful of Malaysians pay tax, and that is not enough to maintain the country's development. Also, be transparent, and explain exactly which projects are going to be funded by tax collected, and so we can make the Government accountable .

Read the articles in Bernama, and the Star

Read the actual report REPORT OF ACCCIM 2010 SMEs SURVEY  as published on the ACCCIM website

Podcast : Implementing GST in Malaysia and Its Effects on SMEs

GST - the dreaded three letter word. What are the repercussions of GST for every Malaysian, and how best to prepare for impending GST implementation in Malaysia.

Listen to the podcast on the BFM 89.9 Business radion station on the topic 'Implementing GST in Malaysia and Its Effects on SMEs" by Mr Paul Jennings, MD of MYOB Malaysia.

GST to cost the Malaysian Government Rm222 million

The Malaysian Government will need to fork out an estimated initial sum of Rm222 million to ensure the smoth and effective implementation of GST system in Malaysia.

The amount consists of Rm  139 million for developing the GST computerisation system,  and Rm 83 million for the Malaysian Customs Department to implement the system.

The annual maintenance cost is estimated to cost Rm 8.5 million.

Statement from the Finance Minister in a written reply to a Member of Parliment


My one sen worth

By implementing the GST system, the Government is expected to generate Rm 1 billion in additional income.

The cost seems reasonable, judging by the tax amount to be collected, and it appears that the government can recoup its investment in 3 months after the GST is implemented. 

I just hope the new system will be thoroughly tested before it is launched.