Hornbill Unleashed

June 5, 2017

With good governance, Umno’s GST not needed

Filed under: Politics — Hornbill Unleashed @ 8:01 AM

Prime Minister Najib Razak has questioned Pakatan Harapan’s ability to garner additional revenue when the revenue collected from the implementation of GST is RM 42 billion. How can Harapan collect RM 42 billion if GST were to be abolished, he asked?

The following herewith are several measures that can be taken up by Harapan that would not only benefit the people, but also stimulate financial growth without the implementation of GST.

1. Proper planning of the country’s resources to avoid a deficit

The Najib Razak administration today has seen the national debt amass up to RM 900 billion as a result of wasteful, unnecessary expenditures by the government, as well as corruption.

A national deficit materializes when the government spends more than what it has and what it can afford to spend, to the point that a debt will accrue due to the Government’s inefficient spending.

Unfortunately, at the end, it will be Malaysians who will be forced to bear the brunt of the nation’s debts.

In 2014, the Auditor General’s Report recorded an average of 15.5 percent as the government’s spending that was wasted that neither included the payroll nor the fixed charges and the like.

This amount of 15.5 percent if compared to the revenue of the government in 2017 had amounted to RM 136 billion and it is without a doubt that with a more efficient form of governance of the country’s resources and proper planning of the revenue collected, there is massive potential for the country to reserve costs of RM 21 billion.

2. Regulate the reception and intake of foreign workers

Based on a Bernama report dated June 29, 2015, the Malaysia Trade Union Congress (MTUC) reported that the number of foreign workers in Malaysia had peaked at 7 million foreign workers, of which only 2.1 million of them were registered here legally.

Data from the Malaysian Department of Statistics revealed that in 2016 there was an increase in registered foreign workers in which 3,265,100 foreign workers had registered legally.

Malaysia suffers substantial monetary loss when the Malaysian ringgit flows out of the country due to the practice of foreign workers converting the Malaysian ringgit and transferring their money to their respective countries.

By the end of the year 2015, Malaysia’s loss increased by 23.2 percent amounting to RM 34.75 billion due to these transactions. This number was predicted to increase in 2016 based on a scale of increase in the intake of foreign workers.

With stricter border controls and prudent regulations in the intake of legal foreign workers to only be allowed for certain sectors in the industry, it has been projected that a staggering amount of RM22 billion can be prevented from flowing out of the country and can consequently be used to generate financial growth in Malaysia.

3. Restore the faith of investors through effective money management, and efficient and corrupt-free governance

Various frugal policies can be effected through the repayment of the interest rates from the debts borrowed from the federal government. In the government’s current situation, they are forced to pay high interests rates on their loans because of the exiguous faith of the investors in an ignominious government.

When investors lose faith in this country’s monetary governance, investors will be disinclined to pay low interest rates in return for holding on to the country’s bonds until the bond matures and is then redeemed by the government.

Thus, the bonds are issued at high interest rates, which subsequently affects the interest payments that are borne by none other than the Malaysian people.

The cost of paying the interests in the year 2017 is predicted to be RM 29 billion and such amount is more than half of the revenue that is collected from the GST, clearly indicating that the revenue from GST is circulated back to paying the hefty interest rates, whereas such an exorbitant amount can be significantly reduced if only investors were more confident in our country’s monetary governance.

Even if the interest rates were to be reduced by a mere 1 percent from the current interest rate, the country would be able to secure RM 6.5 billion.

Taking into account the myriad methods that could be realised in a short period of time if Harapan were to take hold of the reins in governing Malaysia, the amount that could be generated annually even without the imposition of GST is at least RM 49.5 billion.

This estimation excludes the abolishment of closed tenders or the advancement of bids for open tenders that are currently being practised by both Penang and Selangor, to the point that we now witness the success story of the state of Selangor as a key model of governance that succeeded in producing a surplus and witnessed an accretion of state reserves up to RM 4 billion!

If ethics and integrity in practice were carried out at the level of the federal government, billions of ringgit could be prevented from being wasted as a result of leaks and corruption as is practised by the government of Umno-BN.

The revenue as well as the financial reserves could be circulated and redistributed back to the people.

The state of Selangor is a stellar model example which, over time and under a well-driven government, has witnessed a booming economy under a state government that simultaneously conducted welfare programs for its people; for example, free healthcare, free education, free water, free buses, affordable housing such as Rumah Selangorku and numerous forms of assistance and aid that will assist a child of Selangor from birth and throughout life.

At a national level, free education would only cost on average a total of RM 5 billion for 20 public universities, and that is one of the main agendas of Harapan that can tangibly assist the people and the future generation.

Not forgetting, the recent press conference held by Harapan where they gave the assurance that they would create one million new jobs in the span of five years in governance.

More importantly, let us not lose sight of the main purpose for this write-up that it is only through Harapan, that the GST will be abolished!

Source : Malaysiakini by Syed Saddiq Syed Abdul Rahman
SYED SADDIQ SYED ABDUL RAHMAN is Bersatu Youth chief, and is Asia’s best debater, having won the United Asia Debate Championship in May 2015.


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