PAKATAN Harapan (PH) leaders have rejected calls by Barisan Nasional (BN) to reintroduce the Goods and Services Tax (GST) after the 16th General Election (GE16), warning that the move would burden taxpayers and revive unresolved weaknesses from its previous implementation.

DAP adviser Lim Guan Eng said BN chairman Datuk Seri Dr Ahmad Zahid Hamidi had failed to address what he described as the biggest flaw of GST, namely the government’s failure to refund input tax credits as required by law.

He questioned whether the deputy prime minister could guarantee that taxpayers would not again face a repeat of delayed GST refunds amounting to RM30 billion between 2015 and 2018.

“GST is an efficient consumption tax that is fair to all because it requires input tax refunds to avoid double taxation. Unfortunately, the BN government at the time failed to make refunds as required by law.

“As a result, arrears exceeded RM30 billion in just three years. These large GST refunds became a heavy burden on businesses, not only affecting cash flow but also threatening business continuity,” Lim said in a statement yesterday.

On Monday, Ahmad Zahid reportedly said BN would push for the reintroduction of GST after GE16, describing it as the best tax system that should be reinstated in Malaysia.

Lim said the RM30 billion in GST refunds was only paid back to taxpayers by the PH government in 2019. He further claimed that under the Perikatan Nasional (PN) administration which took over in 2020, excess taxes paid by businesses were not refunded and instead reached “tens of billions of ringgit”.

“Once again, as with excess input tax under GST, surplus taxes paid to the Inland Revenue Board (LHDN) were channelled into the Consolidated Fund and spent in advance,” he said.

Separately, Pasir Gudang MP Hassan Abdul Karim told Utusan Malaysia that he did not agree with BN’s intention to revive GST after the tax system introduced under former prime minister Datuk Seri Najib Razak was abolished in 2018.

He said the majority of Malaysians were still grappling with cost-of-living pressures due to low wages, with many unable to move out of the bottom 40% income group (B40).

“If people’s incomes rise through the Progressive Wage Policy and more Malaysians enter the high-income middle class, then it would be appropriate for Malaysia to consider GST — but not now,” he said.