KUALA LUMPUR – The Goods and Services Tax (GST) collection was not robbed or lost as alleged previously by Finance Minister Lim Guan Eng.
The Public Accounts Committee (PAC) report on the Outstanding GST Refunds amounting to RM19.4 billion by the Royal Malaysian Customs Department under the Finance Ministry made the conclusion after taking statements from 10 witnesses, being briefed by the Auditor-General and taking into the consideration of the opinion from the Attorney-General.
According to the Chairman of PAC, Datuk Noraini Ahmad, the previous government had overestimated the nett GST collection at the rate of 65 percent from the total GST collection.
According to her, the delay of funds transfer from the Consolidated Income Account to the GST Refunds account was made in order to prioritise on the cash flow of the country so that it would not suffer management deficit.
Therefore, the PAC proposed for the government and its administration to always ensure full compliant to the law of the country, especially in financial execution so that the finance administration is more organised and accountable.
“Government officers entrusted with their duties need to advise the administration of the government on the law, procedures and information on the numbers without fear or taking sides in implementing the cash flow plan and fiscal discipline so that it would be more accountable,” she said in a statement today.
Noraini added, the report is made after Finance Minister Lim Guan Eng’s controversial accusation in the Dewan Rakyat on August 2018, by claiming that the RM19.4 billion GST refunds have been ‘robbed’ by the previous government.
PAC then began its proceeding on 12 September 2018, by calling all stakeholders in this issue, including the Finance Minister, former Finance Minister, former Finance Minister II, Secretary-General of Treasury, Director-General of Customs and Accountant-General.
PAC was also briefed by the Auditor-General on the authenticity of GST refunds claims amounting to RM19.4 billion, besides getting the opinion from Attorney-General on the procedures of GST refunds.
She said, during the meeting on the proceedings, the PAC members raised several issues which include:-
- The failure to transfer GST collections into the GST Refunds account.
- The power of the Finance Minister under Section 54(5) of the GST Act 2014.
- Fixing the 35 percent rate for transfer of the GST collection to the GST Refunds Account.
- The timeframe to process GST repayment,
- The affordability of the government in refunding RM4 billion to the tax payers.
- Cashflow management.
- The application for RM4 billion of GST refunds from the consolidated account to be transferred to the GST Refunds Account.
- The status on GST claims which has yet to be paid.
The PAC presented the report at the Dewan Rakyat today.
For more information on the report, the public may download the full report at PAC’s website at www.parlimen.gov.my/pac. -MalaysiaGazette