TPPA in MALAYSIA

The TPPA will not only bring economic benefits and serve Malaysia’s best interests as shown by the two studies commissioned by MITI, one of which estimates Malaysian gross domestic product (GDP) gains of USD23­27 billion in 2027 in a baseline scenario, an increase in economic activity which will sustain 1­2 million new jobs by 2027. Most recently, a World Bank study predicted that Malaysia’s economy would swell by 8% and exports would rise by 20% as a result of the agreement, with Malaysian exporters having an advantage over regional competitors not part of the bloc. More importantly, the TPPA will push Malaysia to address its governance problems such as corruption and its opaque procurement system. In that way, the TPPA will complement the liberalisation and transformation programmes that Malaysia is currently undertaking and push for more economic freedom in Malaysia. This is one of the socio­political benefits of the agreement.

Chapter 17 of the agreement aims to ensure a level playing field between State Owned Enterprises (SOEs) known as GLCs in Malaysia ­ and private entities that compete in the market. It requires GLCs to use commercial considerations, not other considerations such as developing racial or political leanings, and avoid discriminatory treatment in their procurement processes. If GLCs provide assistance to local companies, it should be carried out in a way that does not harm competitors. The agreement also requires explanations on the form of assistance given, the reasons and how it will affect investment and trade to other member countries. However, the obligations of the chapter are not strong enough to reach its objective as it give flexibilities to Sovereign Wealth Funds (SWF), pension funds, and any “enterprise owned or controlled by an independent pension fund” (Article 17.2.5 & 6). This means that Khazanah Nasional as Malaysia’s Sovereign Wealth Fund (SWF), and Employees Provident Fund (EPF), Lembaga Tabung Haji, Lembaga Tabung Angkatan Tentara (LTAT) as pension funds will not be subjected to some of these chapter’s obligations. Malaysia also managed to secure other carve­outs and transitional measures for its SOEs: ­ The obligations of the chapter are not applicable to state government­owned companies and companies owned by Lembaga Tabung Haji and PNB as long as they operate for the purpose they are established for which is to enhance the savings and investments of their member (Annex 17­F Malaysia). ­ Only companies with an annual revenue of more than SDR 500 million will be subject to the obligations (while for other countries the threshold is set at SDR200 million) 3.2 TPPA can help improve the governance of Government Linked Companies (GLCs) ­ Khazanah will not be subject to the dispute settlement mechanism in Chapter 28 until two years of entry into force. Although some Malaysian GLCs are exempted, the obligation to follow non­discriminatory treatment and commercial consideration principles will have a positive impact on the practices of these GLCs as a whole. GLCs will have to be more careful when procuring goods and services, providing loans, grants or other types of assistance to other entities as well as when making investment decisions. Additionally, despite the late application, the transparency requirement of the chapter will encourage Malaysia to adopt positive practices. The transparency section requires Malaysia to publish a list of GLCs, provide information on its non­commercial assistance including the name of agency, the type of assistance, amount and duration of the assistance, and how this assistance affects investment and trade. This is a major improvement for the country. The chapter even requires countries to provide statistical data so that others can analyse the impact of assistance on their trade and investment. These requirements will widen the scope of the GLC transformation programme that the Malaysian government has been undertaking since the time of Prime Minister Abdullah Badawi.

GST

WARRANTY government not to implement the goods and services tax (GST) so that the tax system was accepted by the people is an announcement very welcome because it is still new in the country and the people are still not have a comprehensive understanding about it.

However, for those who have visited foreign countries that have implemented tax ITU also known as VAT (value added tax), it was not an unfamiliar because the GST or VAT was to their advantage as a buyer when shopping in these countries.

This is because as tourists, they are exempted GST / VAT on goods purchased and can claim back goods GST / VAT from the customs office in the airports of the country concerned.

Implementation in many countries around the world that prove this tax system is better because it involves a more comprehensive taxation system of production of goods compared with the existing tax system, which only involves the final buyer.

GST / VAT was introduced in France in 1954 by Maurice Laure to change the system highly dependent on uncertain tax based on sales for balancing the income tax system is not very effective.

Now more than 140 countries around the world implement GST or VAT because it is a tax system that is among the largest or the second largest contributor to the national income because the tax is more comprehensive and not only apply to the final consumer goods.

Implementation of the tax system is found to be burdensome, as claimed by some parties and for example in Australia have implemented the GST in 2000, personal income tax rates, tax, banking, tax wholesalers federal and some oil tax decrease which in turn causes people not pay any additional taxes.

Although there are parties in the country claimed that the negative impact of the implementation of the GST as it said the real estate sector affected by the ruler GST after house prices rose by eight per cent, but the actual situation is the rise was due to increased demand from the real estate sector from 2002 to 2004.

In Australia, some goods and services are free of GST and the items were food, education, health, exports, charitable activities, child care and religious services.

Canada to introduce GST in 1991 to replace the manufacturers sales tax also do not charge GST on items such as groceries, rent housing, medical services and financial services.

In that country, exports are exempt and individuals with low incomes can get a rebate of GST involving individual tax relief.

While in New Zeland to introduce GST in 1986, all types of food products are subject to the same tax rate but it gives an exemption to certain types of activities such as residential rental rates, certain steel products, financial services and contributions.

According to the law of the country, the price of goods must be subject to GST, except the business that is based on customer-based wholesaler activities.

For the countries of the European Union, GST is known as' output VAT (output tax on the manufacturer) and 'input VAT' (tax paid by the company after receiving the items). Eligible companies can claim back tax payments from the government.

Based on the various methods of taxation GST or VAT implemented in more than 140 countries around the world, Malaysia has conducted in-depth study on the impact of its implementation to the people, and the company's financial position.

For the government, the implementation of around 4 per cent GST is expected to generate a turnover of RM1 billion next year the money can be used for various development projects for the benefit of the people.

For citizens, they can benefit immediately from the implementation of the GST to be able to enjoy lower prices for all kinds of goods, especially essential goods and food related.

For example, people only have to pay the GST four percent when dining at fast food restaurant versus a higher service tax is imposed now.

Business costs also decreased after the GST replaced the sales and services tax (SST) as the restaurant no longer have to pay sales tax on the purchase of tables, chairs and other facilities. Thus, the trader can offer a cheaper price savings result from the payment of taxes.

However, not all prices will decline after the GST was introduced and there are also certain items that will slightly increase or remain at the original price. On the matter, the government has promised to try to talk to supermarkets - hypermarkets so that they maintain the old prices if the price of goods had increased after the GST was introduced.

In conclusion, a broader tax base and imposed on one level through the introduction of GST would enable the government to manage and administer the system and it is also easy to understand the people than the current tax imposed at different rates for different goods and services.

1 Malaysia Programs

1)      Interactive-Tuition Rakyat 1Malaysia (i-TR1M)

i-TR1M is learning after school program to provide free tuition for students from low-income families for subjects UPSR, PMR and SPM online or via conventional means. The program also targets students who are weak in important subjects such as Bahasa Melayu, English, Mathematics and Science. The project is expected to foster a culture of self-study among students in addition to teaching to become more independent in the future.

2) Kedai Rakyat 1Malaysia (KR1M)

About 99 such shops have been opened across the country at the moment. Each store is formatted like a mini-market, offers a variety of daily necessities at low prices. KR1M absolutely can reduce the burden of Malaysians, especially the lower income group in urban areas.

3) 1Malaysia One Call Centre (1MOCC)

1MOCC is a single online center that operates 24 hours a day, 7 days a week to answer public inquiries, complaints, suggestions or reactions by telephone, short message service (SMS), fax, email and social media.

4) Skim Amanah Rakyat 1Malaysia (SARA 1Malaysia)

This is an investment trust fund supported by the Government for those with a household income of less than RM3,000 a month. In collaboration with the National Capital Berhad, the scheme benefited about 100,000 households and allows those eligible to invest up to RM5,000, with monthly returns of RM134. Loans may also be made for the purchase of units of Amanah Saham 1Malaysia.

5) 1Malaysia Training Scheme (SL1M)

The program provides training / internships to new graduates by government-linked companies (GLCs) to reduce unemployment among the youth. Apart from various forms of training, this project also offers courses in English language skills and communication courses for several months before they are absorbed into the fields they choose. Companies that provide training in this program receive a tax deduction twice on allowances and training expenses. So far, 100 companies have joined SL1M.

6) 1Malaysia Food Safety Scheme (SK1M)

SK1M is an ongoing initiative to inspect all food items produced by small and medium industries before entering the market. The measure aims to ensure that 35,000 entrepreneurs in the country to produce food products that are high quality, safe and clean through the implementation of strict rules.

7) 1AZAM (1AZAM)

1AZAM program was created to help the poor and hardcore poor, generate employment and increase revenues.

8) BantuanRakyat 1Malaysia (BR1M)

RM700 financial assistance is given directly to Malaysians with a household income of less than RM4,000 a month. Fee for once (one-off) have been implemented since 2012 and has benefited 75 per cent of all households in the country.

9) 1Malaysia People's Welfare Programme (KAR1SMA)

The program aims to provide monthly financial assistance to the elderly with low income, poor children, the disabled, single mothers and widows of soldiers and police. This aid is channeled to support the life of these people so that they do not feel marginalized by society. Each person or household received RM100 to RM450.

10) Perumahan Rakyat 1Malaysia (PR1MA)

For those who always wanted a dream home for the 1Malaysia People's Housing (PR1MA) is the solution. Under this initiative, the Government is to develop, construct and maintain affordable housing projects for middle-income Malaysians (with a household income of between RM2,500 and RM7,500).

Towards high income nation

Malaysia is one country that practices open economy (open economy), namely economy that interacts freely with other economies or other languages ​​to run import export openly with foreign countries. Openness to enable economic development of a strong economy and increasing per capita income. In addition, Malaysia is also an upper middle-income countries, where revenues are too low and still go to high-income countries. Malaysia is among the 13 countries identified by the Commission's Growth and Development has recorded an average growth of more than 7 percent a year for 25 years or more in 2008. Growth Report Economic growth is inclusive, because Malaysia is also able to eradicate poverty, which is the body home living below the national poverty line (USD 8.50 per day in 2012) fell more than 50 percent in 1960 to less than 1.0 percent today.

Many attempts have been made by the government to achieve economic position today and are still working to improve the country's economy and achieve high-income nation in line with Vision 2020. Among the measures that have been implemented are the New Economic Policy (NEP) has designed a new Economic .Basal for a period of 20 years from 1971 to 1990 aims to eradicate poverty issues of the Malays and Bumiputeras in all areas indirectly foster unity and integration in Malaysia.Selain, the Malaysian government has also implemented a privatization policy and the Malaysia Incorporated Policy 1983.Ia year represents a new approach in national development policies and facilitate the development of the national economy, reduce the financial burden and perntadbiran kerajaan.Pertanian also playing an important role in the national economy through its contribution to the national income and export earnings and creating opportunities kerajaan.Sektor this is the main supplier food and raw materials for insdustri based sources. Therefore, the government is taking steps to accelerate the competitiveness of this sector in order to face new challenges on the domestic and in the international level by launching the third National Agricultural Policy (NAP 3) that seeks to maximize revenue from the sector while enhancing the national economy and people's income.

On this day, under the leadership of Prime Ministers of the six, the Honourable Dato 'Seri Haji Mohd Najib bin Tun Haji Abdul Razak various efforts were stepped up to strengthen and stabilize the national economy. Among them are implementing goods and services tax (GST) of 6%. Government spending much depends on the amount of tax revenue collected. Tax revenue was the main contributor to total government revenue. If the result of the tax increases, the government can implement various projects to drive economic growth. In line with the goal of making Malaysia a developed nation, the government should implement tax reform that intends to make the existing tax system more simple, transparent and more efficient. Tax reform is also necessary to increase revenues and drive economic growth. Therefore, Malaysia needs to implement the Goods and Services Tax (GST) as it has been implemented by most countries in the world. The implementation of GST will enable the Government to lower the rate of income tax (individual and corporate) and make Malaysia more competitive in order to attract foreign investment. GST bill was tabled in Parliament in 2009 for the first reading and should be followed by a second reading but was postponed to allow the views of the people is taken into account. The method has many advantages over the GST tax system before the SST. GST can increase the amount of the proceeds of the government and thus enable more development projects undertaken to improve the country's economy. GST is a step forward in making Malaysia a developed nation. Since the sales tax and the GST replaced the existing service tax, the GST is not expected to result in higher prices of goods and services, unless the applicable tax rate is higher than the rate of sales and services tax imposed at this time.

In addition, the tourism sector is the third largest contributor to the national economy after manufacturing and palm oil has also dititikberatkanOleh, the government has organized a program under the ministry of tourism of "Visit Malaysia" and also Malaysia Truly Asia. The campaign is aimed at attracting tourists from abroad to travel to Malaysia as well as to promote Malaysia to the world and attract investors to invest in Malaysia. The tourism industry is not only encouraged industry expands business area, including in the services sector, which generates income and economic activity, but also to bridge the relationship between the people and rakyat.Menurut Dean of the Faculty of Hotel and Tourism Management Universiti Teknologi MARA (UiTM) Shah Alam Prof Prof. Dr Mohamad Abdullah Hemdan, he saw the initiative to boost the tourism sector will encourage entrepreneurs and tourism industry to continue to grow their business. In order to realize the government's goal of achieving the target of 26.8 million visitors, he urged industry players the chance to offer luxury travel concept as it will contribute to the surge in the country's economy.

Next, the latest effort by the government is a sign the Trans-Pacific Partnership Agreement (TPPA). TPPA is said to bring more advantages than disadvantages to the country. Minister of International Trade and Industry, Datuk Seri Mustapa Mohamed said, as a nation that depends on trade and foreign investment, Malaysia will benefit greatly from the TPPA. However, he said, the government will not arbitrarily sign the agreement without the consent of all parties. TPP is a great thing for the country and the government should give a thorough explanation to the people about the pros and cons of the deal tersebut.Disebabkan it is still in its infancy, information programs will be actively implemented by the ministry and can be fruitful if the number of interested parties TPPA examined in depth.

Furthermore, the National Key Result (NKRAs) has also been established. If the GTP is the overall engine of change, the National Key Results Areas (NKRAs) are the pistons within. And like pistons, each NKRA works on its own, but through their complementary efforts, they generate a force of change that is greater than the sum of its parts. Each piston correlates to a priority area that is deemed to have the greatest impact for the residents. The NKRAs were not deemed priority areas arbitrarily, but the result of various surveys, opinion polls and conducted dialogues with the people. Each NKRA is led by a Cabinet Minister who is ultimately responsible to the Prime Minister for the successes and shortfalls of the NKRA's key performance indicator. The priorities of the NKRAs are made up of both short- and long-term initiatives catering to the needs of the people. GTP therefore addresses the urgent demands of the people, such as reducing the cost of living, as well as structural issues preventing the civil service from being as efficient as it could be.

11th Malaysia Plan (11MP) from 2016 to 2020 also has the potential to boost the country's economy. 11MP theme "Growth Anchored People" which aims to menyiapsiagakan people for the future and elsewhere all people can enjoy the country's progress. 11MP will strengthen the resilience of the economy to boost growth in addition to macro manage public finances prudently. In the 11MP, we have focused on several fronts to improve the development of human capital to developed countries. Among them is to improve the efficiency of the labor market so as to enhance economic pertummbuhan. The second focus is the field of transforming TVET fo meet industry demand while third focus area is strengthening lifelong learning to enhance their skills and lastly add the quality of education to improve student outcomes and institutional excellence.

Finally, strengthening the infrastructure to support the growth that is focused first ekonomi.Bidang is memmbangunkan integrated transport system based on the requirements. The second field is the growth logisti and the trade facilitation. Improving the coverage and quality of infrastructure and the ability of digital subscriptions and promote the use of sustainable energy to support growth.