Najib: GST a progressive tax that benefits low-income group

KUALA LUMPUR: The low-income group will benefit more from the implementation of the Goods and Services Tax (GST) than the high-income group, said Prime Minister Datuk Seri Najib Razak.

He said there was still a misunderstanding on the implementation of the tax and it was interpreted as “regressive tax”.

He said the mechanism of the tax was progressive as the lowincome group received more government benefits from GST revenue collected from the high-income group.

“GST exemption on basic needs ensures that the low-income group will not be affected by the tax, while the high-income group will pay more tax because they spend more.

“The government also helps the low-income group through welfare assistance like BR1M (1Malaysia People’s Aid), school aid, assistance for farmers and fishermen and special payments to civil servants.

“If the high-income group doesn’t contribute to GST revenue, these targeted welfare programmes will not be possible,” Najib said on his blog yesterday.

He said although the low-income group also paid GST at six per cent, they received more benefits than the middle- and highincome groups.

“The government will ensure that the best quality of welfare is given to all and the implementation of the tax matches the current economic situation.”