This article first appeared in The Edge Financial Daily on July 20, 2018 - July 26, 2018

KUALA LUMPUR: The upcoming sales tax and service tax (SST) will only be imposed on 38% of the Consumer Price Index (CPI) basket of goods, as compared to 60% by the goods and services tax (GST).

Finance Minister Lim Guan Eng said facts and figures do not support claims by former prime minister Datuk Seri Najib Razak that Malaysians will pay more under the SST system.

Guan Eng said Najib so far has not responded on how the SST could burden the people more than the GST when the expected collection from the SST is estimated at RM21 billion for a full year, while the GST had expected to collect RM44 billion in 2018.

He added that the SST is a single-stage tax imposed on manufacturers and not on end customers while GST is a multi-stage tax where tax is payable by all parties in the supply chain.