Malaysia rules out GST return, signals flexibility on SST rates

The federal government will not reconsider the foundational principles of the Goods and Services Tax but remains willing to modify the current Sales and Service Tax structure, Prime Minister Anwar Ibrahim said Wednesday. The position underscores Putrajaya's determination to maintain its tax policy stance while potentially fine-tuning existing levies to address economic concerns. Anwar stressed that any tax adjustments would not burden Malaysia's lowest-income earners, aligning with the administration's broader poverty alleviation objectives. The government previously replaced the GST with SST in 2018 following public opposition to the earlier consumption tax model. The latest remarks suggest policymakers are exploring ways to optimize revenue collection and economic competitiveness without fundamentally overhauling the tax architecture established under the current administration. Economic observers have noted growing discussions around tax efficiency and fiscal sustainability as Malaysia navigates post-pandemic recovery challenges.