Najib should not use Singapore as an example to justify the robbery of GST refunds

Najib Razak claims that the Public Accounts Committee’s (PAC) report has vindicated him from robbing the GST refunds. He insists that the act of putting the GST revenue directly into the Consolidated Revenue Account was not wrong.

In particular, he mentioned that this was similarly practiced in other countries such as Singapore. This was also mentioned in his testimony to the PAC.

Najib should be ashamed for using Singapore as an example to cover up his wrongdoings.

First, the laws governing GST in Malaysia and Singapore are different. In Singapore, Section 5 of the GST Act provides that the amounts collected from GST shall be paid directly into the country’s Consolidated Fund.

On the other hand, in Malaysia, Section 54(2) of the GST Act 2014 clear states that the moneys collected from GST must first be put into a specific GST Refund Account which functions as a trust fund.

It was on this basis that the Attorney General, in his opinion to the PAC, stated that that the law has been violated and this is open for further criminal investigation by the police.

Second, Singapore will pay interest to claimants who do not receive their refunds within 30 days of submitting the claims. This shows that Singapore understands and respects the fundamental notion of trust, and that the moneys for GST refunds do not belong to government.

Instead, in Malaysia, it is a known fact that there are cases where the GST refunds has been delayed for more than two years. Najib has shamelessly justified this as part of the government’s cash flow management.

In reality, it is nothing short of robbery and a breach of trust because it is in effect taking and withholding money from tax payers by force. Through this, Najib and the previous government was able to enjoy interest-free capital at the expense of tax payers who had to bear the consequences of not receiving their refunds.

Najib should therefore stop tainting others with his dishonesty. Unlike Najib’s dishonest administration, Singapore practices full accountability and trust.

The Pakatan Harapan government and Finance Minister Lim Guan Eng have shown strong commitment to resolve this issue. As of 30 April 2019, RM9.5 billion has been refunded to the GST registrants, thus honouring what the previous administration has failed to do.

Khoo Poay Tiong
Media statement by Khoo Poay Tiong in Malacca on Wednesday, 17th July 2019