You stated recently that taxes collected under SST help fund critical public services and national defence such as hospital repairs, fix roads, build schools, or buy new aircraft for our Armed Forces.
Talk is cheap when it comes to taxes.
When you impose costs on people, there is a profit opportunity for those who find a way around the costs.
Even if you close off all avenues, tax avoidance is unstoppable.
People can always stop working especially if you counter that with rigorous enforcement which for obvious reasons will push more people to take that option.
As such, there will always be a tax rate be it SST or other taxes beyond which you lose tax revenue.
When you reduce taxes for poorer households, it increases their compliance while increasing taxes for richer households decreases their compliance as they can afford to have professional tax and wealth planners to advise them to minimise their tax payable.
Economic laws are simple.
If you tax something, you get less of it.
If you tax work, people will work less.
Thus, your claim that SST will not burden the poor, but generates gains for the society as a whole is deceptive.
Businesses are profit maximising entities.
They will find creative ways in paying less taxes.
From the governance standpoint, the cost of enforcement in deterring businesses from profiteering will rise as well.
Tax collection will be weakened as there will be greater room for tax avoidance and loopholes among businesses.
Since 1970, Malaysia has been spending more than it earns.
Running a budget deficit for 48 years means it has had to borrow to make ends meet.
At the end of May 2025, the total government debt is at RM1.27 trillion.
And if it included government guarantees provided to various entities of approximately RM337 billion, the liabilities reached almost RM1.6 trillion.
Divided by a population of approximately 36 million, this debt is equivalent to RM44,444 for each of us.
Since small, a lot of us, especially the ordinary rakyat, with the exception of the younger generation, were taught by our parent not to spend more than we earn.
The same philosophy applies for a country.
Why is the federal government spending more than it earns?
A major factor is the large leakage in government spending due to corruption and wasteful spending that has been highlighted by the Auditor General year after year in his annual reports.
It has been estimated that the country can easily save RM25 billion to RM30 billion without changing any of the deliverables if we can get rid of corruption and cronyism.
Transparent practices like open tendering can cut down the cost of much of the procurement and project spending.
Don’t wait until Petronas is no longer the largest revenue contributor.
When that happens, our budget situation may become very critical.
And future generations i.e your grandchildren and their children then will not forgive you for leaving a huge burden to them.
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