PENANG, 18 August 2014 – Although the implementation of 6 per cent Goods and Services Tax (GST) was announced in October last year to be implemented on 1 April 2015, there are still ambiguities about its implementation among those affected.

According to BDO Asean Managing Partner (Malaysia) Dato’ Gan Ah Tee, 160 countries have implemented GST/VAT (Value-Added Tax) since 1948.

“Replacing the current Sales and Service Tax, GST encompasses any supply of goods and services made in Malaysia and also any importation of goods and services into the country,” he clarified.

He cautioned on the sale of shophouses, explaining that although the sale of a residential property is exempted from GST, the sale of a shop lot is taxable and hence part of the shophouse sold is taxable.

“All records pertaining to GST has to be kept in Malaysia for a period of seven years for Royal Customs and Excise Department’ s auditors,” said Gan.

In a timeline, he recommended companies with an annual turnover threshold of RM500,000 and above to register by 1 June 2014 before the registration deadline on 1 January 2015.

“For a successful GST implementation, one has to be aware of the impact of GST on one’s business, consider GST implications on one’s pricing and cashflow, compliance to GST documentation requirements, and tracking pricing adjustments in debit notes and credit notes,” he said.

After Gan’s presentation, BDO Senior Adviser, Ng Swee Weng, warned that it is of utmost importance to ensure that documents and procedures of GST are strictly complied with because for a general offence, the offender is liable to a maximum of RM30,000 fine and/or two years imprisonment.

“For incorrect return, the fine is increased to a maximum of RM50,000 and/or three years imprisonment,” he added.

For evasion or fraud, the fine is 40 times the amount evaded or defrauded and/or seven years imprisonment.

“Then who will be liable for a GST offence? According to the law, the director, partner, manager, secretary or other similar officer of the company, firm, society, association or other body of person,” said Ng.

That is, unless, the person is able to prove that the offence was committed without his knowledge, consent or connivance; and that he had taken all reasonable precautions and had exercised due diligence to prevent the commission of the offence.

The presentation was as what Deputy Vice-Chancellor (Industry and Community Network) Professor Dato’ Dr. See Ching Mey said in her opening speech, “Deligence, creativity and innovation are very important for Malaysia to leap bound to achieve high-income nation status through the Government Transformation Programme.”

Organised by the School of Management, the 6^th USM-CEO Talk Series at USM provides a platform for the Chief Executive Officers (CEOs) in sharing their experiences and future direction of the industry, business market and global economy.

Among those who attended the packed event were School of Management Dean, Prof Dr. Fauziah Md Taib; Graduate School of Business Deputy Dean (Student Affairs and Networking), Tuan Haji Noor Nasir Kader Ali; and industry representatives. - Text: Yong Check Yoon/Photos: Mohd Fairus Md. Isa