Prime minister Tun Dr Mahathir Mohamad recently announced the sales and services tax (SST) will be reintroduced in September this year. Ahead of its return, a report on the implementation of the SST will be submitted to the government within two weeks, according to Bernama.

This was revealed by Tun Daim Zainuddin, head of the government’s Council of Eminent Persons, who also said the SST system will be an “updated version” with the ultimate goal of lowering the price of goods and services for the people. Where the GST rate was set at 6%, finance minister Lim Guan Eng disclosed the SST rate will be set the same as in the past at 10%.

“There will be no immediate need to introduce any new taxes, nor increase the personal income tax or corporate tax rates at this juncture,” said Daim. He added that the SST will allow the government to secure sufficient revenue to cover the loss of proceeds from the removal of GST.

“The Royal Malaysian Customs Department has already given me a preliminary report. Revenue may be less than RM5 billion but oil prices are increasing steadily. The [2018] Budget was worked out on the premise that oil prices would hover around US$52 (RM206.78) per barrel but now it is fetching about US$70 (RM278.35) per barrel. Last week, it was US$80 (RM318.12) per barrel. For every US$1 (RM3.98) movement, we will earn RM300 million to cover our shortfall,” Daim explained.