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.
Tuesday, June 7, 2016
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.
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).
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