Opposition Leader Urges Putrajaya to Restore GST and Halt Uncertainty

Hamzah Challenges Government Tax Policy During Budget Debate

KUALA LUMPUR — Opposition Leader Datuk Seri Hamzah Zainudin alleged on Oct. 12 that the government’s recent hybrid taxation proposal served as a tacit admission that it was wrong to reject the goods and services tax (GST). Hamzah made the remarks during the debate on the Supply Bill (Budget) 2027 in Parliament. He stated that recent proposals to incorporate consumption tax elements into the Sales and Service Tax (SST) indicated that the current tax system was lacking. Hamzah urged the government to implement GST immediately rather than leaving citizens in uncertainty. He noted that while events seemed to be heading in that direction, no one wanted to explicitly say they wanted to use GST. The opposition leader alleged that Pakatan Harapan lawmakers in the government were "embarrassed" to support reviving GST due to their previous rejection of it.

Historical Context of Taxation Changes

GST was first implemented at a standard rate of six per cent in April 2015 under former prime minister Datuk Seri Najib Razak. It became a central battleground in Malaysian electoral politics. Following the 2018 general election victory, the Pakatan Harapan administration zero-rated the GST before repealing it in favor of the current SST regime. During the Oct. 12 debate, Hamzah highlighted the contrast between past political stances and current fiscal proposals. He argued that the shift toward hybrid taxation models demonstrated a recognition of the limitations within the existing SST framework. The opposition leader’s comments came as part of the broader discussion on the 2027 Budget. The Supply Bill debate provided the platform for Hamzah to question the consistency of the government’s tax policy over time. Hamzah did not provide specific details on how the hybrid model would function or what rate it might carry. His focus remained on the political implications of revisiting a tax system that had been abolished nearly eight years prior.