Customs says it can achieve RM43b GST revenue

By D KANYAKUMARI / Pic By ISMAIL CHE RUS

The Royal Malaysian Customs Department said it can achieve the target of an additional RM2 billion in Goods and Services Tax (GST) revenue in 2018 based on the projected increase in consumption, coupled with its strategies to ensure compliance.

Customs DG Datuk Seri Subromaniam Tholasy (picture)  said based on data available, the department sees a significant growth in the 2018 gross domestic product (GDP) that will spur consumption.

“Consumption will grow and this will contribute to the GST revenue,” he said.

Subromaniam said Customs will also improve GST collection through the introduction of its Informed Compliance Strategy.

“It was launched recently and we expect it to yield substantial results to improve GST collections. He said the new strategy is meant to encourage voluntary compliance with GST submissions.

“Of course, if they still refuse to declare, we will then take the enforced compliance approach where they will be dragged to court,” he said.

Subromaniam said in May, 62,000 companies were given friendly reminders to declare their taxes and that only 10,000 companies had responded so far.

Responding to speculations on whether more items would be included in the list of items subject to GST, Subromaniam said no decision has been made yet.

Under Budget 2018, the government expects to collect RM43 billion in GST revenue compared to the RM41 billion it will collect in 2017.

The World Bank has revised up Malaysia’s GDP growth forecast for this year to 5.2% from 4.9% in June, on the back of a much stronger than expected growth of 5.7% in the first half of 2017.

Subromaniam said the department is also planning to curb smuggling of contraband cigarettes and expected to collect more tax as a result.

“What we can say is—we are looking to collect more taxes by indicatively curbing the smuggling,” he said.

He was asked about the government’s projection that it will collect RM300 million more from tobacco in 2018 under the recently tabled Budget 2018, which has led to speculation that cigarette prices will go up soon.