‘Inflation rate has normalised’
MALAYSIA’S inflation rate has normalised after 18 months of implementing the Goods and Services Tax (GST), said Finance Minister II Datuk Seri Johari Abdul Ghani.
He said there was a drastic hike in prices of goods in the initial stages of GST implementation, boosting the cost of living and leading to a rise in the inflation rate.
“But today we see our inflation rate has come to a normal level which is approximately at 2%,” he said in reply to a supplementary question by Datuk Abdul Hadi Awang (PASMarang) who said although the GST implementation had prevented traders and businessmen from evading tax payment, it has caused high inflation burdening the poor, especially students.
“I don’t agree with that. At the start of the GST implementation, we saw a drastic increase in prices of goods.
“Previously when the government implemented the Sales and Services Tax (SST), many traders evaded paying it and when they had to fully pay GST, they hiked prices to cover costs,” Johari said.
He added the SST system was not effective as there were payment leakages.
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