The Middle Ground: The brewing storm of GST

The brewing storm of GST

http://romerz.blogspot.com/2010/03/brewing-storm-of-gst.html

The Malaysian federal government intends to implement a General and Services Tax (GST) by the third quarter of 2011. Now you may ask what is GST and how will it affect you? I wondered too that is why I took the opportunity to attend the GST Forum organized by PR (mentioned in my previous post) and listened to those who provided an opposing view to that of the government's propaganda through the main stream media.


Let me add a qualifier here first. Before I went to this forum, I was of the opinion that GST is a form of taxation that Malaysia must take one day for the well-being of the country on the long run. However one thought kept bugging me which is corruption and leakages. I kept wondering if it was prudent to raise additional revenues for the government by taxing the length and breadth of Malaysian society (at the expense of those hardest hit - the poor) when the likelihood of these additional revenues may end up wasted or worst still in the pockets of a select few.

Of course I was also looking at it from a selfish point of view as a current taxpayer. Despite knowing that GST is a "good" form of taxation, I was apprehensive of being dealt the double whammy of paying GST and also paying income tax, taxing the poor tired 15% further!

Currently in Malaysia, only 15% of the 12 million workers pay taxes, ie. 1.8 million Malaysians are carrying the burden of supporting 27 million Malaysians. Not that the other 85% of Malaysian workers do not want to pay taxes but the reality is, they don't earn enough to be taxed - the sad fact of Malaysia being stuck in the middle income trap which experts and even the government realizes.

Ok, now you know where I stood on GST before 8.00 pm today, before I heard YB Tony Pua, YB Dr Dzulkefly Ahmad and En. Rafizi Ramli spoke tonight at the forum moderated by YB Liew Chin Tong.

I will not try to explain what GST is or how it works and how it affects EVERY SINGLE Malaysian as that will take too long. You have to find out yourself and believe me, you better want to find out as this GST thing is going to affect you in more ways than you have been told by the government propaganda machinery which in turn could and most likely will shape the political future of the country which has ramifications on life as we know it in Malaysia. It is that serious!

Think of it this way. Everybody knows whatever form of additional taxation is what most sitting governments would avoid unless it is absolutely necessary because of the backlash from the electorate. Did you know that when Canada introduced GST in 1991, the government was brought down at the following general elections in 1993? The political party who introduced GST in Canada eventually disbanded in 2004!

So why is the ruling BN government even contemplating this GST move given the present challenge to its rule by PR since 8 March 2008? Surely they are not suicidal nor do they have a death wish do they?

The simple answer is the country is going BROKE! The present economic model of affirmative action (of the selective kind) without expanding capacity is bleeding the country dry. Imagine this. Despite the huge bumper profits from Petronas these last five years, the BN government saw it necessary to operate an increasing budget deficit for the last 12 years! So much so that the nation's current debt is 50+% of Gross Domestic Product (GDP measured annually) and this is an untenable situation. Experts say that when a country's debt is around 65% of GDP, the country will no longer be able to sustain its interest payments without expanding its principal debt!

And we are close. Just imagine that in 2009 alone, we added another 7.4% of GDP to our national debt! Another two years of 7.4% and we would reach 65% of GDP and the downward spiral begins!

Unless the government finds new sources of revenues to contain and reduce the spiraling borrowings, our future borrowings is going to cost even more when our international risk rating drops further. Simply put, after 12 years of irresponsible fiscal management (when Malaysia's economic bubble burst in 1997), we are now spiraling downwards in a free fall.

Enough said on this and let us not dwell on the past of lost opportunities which our oil money could have done for us if used prudently and wisely and not on popularity measures to keep a political party/coalition in power.

Oil money which had financed 40% of our annual budget is running low. Please refer to my earlier posting on our oil money : Malaysia's oil - 14.26 years left. Make sure you read the comment from an oil industry player about being a net importer of oil in 2 years!

Let us instead look at what the federal government could do before hardship is brought upon most Malaysians through GST.

The government has to make a choice, simple as that. Right now they are twiddling their thumbs because they are faced with an impossible situation - country or self and these two don't mix!

As rightly pointed out by the speakers from PR, why is the government reluctant to review the lop-sided agreements to the IPPs whilst at the same time considering raising utility rates which will only burden the rakyat further? Why is the government unwilling to acquire the north-south highway when PLUS recently declared a profit of RM1.3 billion when the government compensated them RM800 million for not allowing them to raise toll? As the speakers pointed out, the entire length of the north-south highway could be acquired by the government and the acquisition paid for in seven years if we didn't have to compensate PLUS yearly through lop-sided agreements!

Why are there no open tenders for government procurement when the Penang state government has shown that they could turn around a RM34 million budget deficit for 2008 (estimated by the previous BN government) into an RM80+ million surplus in the same year!

There are many more examples of silly wastage and inefficiencies of the delivery system by way of patronage, cronyism, corruption, and what have you simply because those who manage our national economy are in a limbo. Don't believe me? Read the Auditor-General's latest report. If there were no inefficiencies and leakages in government spending, RM28 billion could be saved!

RM28 billion which could postpone the GST until after the 13 GE!!!

Simply put, UMNO/BN knows the country is in trouble but to cure Malaysia from her ills would mean taking action against the very people they depend on to remain in power. They know that Malaysia cannot continue this way as eventually when the majority goes hungry, they will be out of power also. But what choice do they have if they want to continue to enjoy the perks of power if not to push the buck to gullible and indifferent Malaysians?

After all we allowed them, those who took the easy way out of "not wanting trouble' and "looking after the rice bowl"! Which brings me back to the 15% of tax paying Malaysians. We are in an unenviable position, to push the load of sustaining the country to the other 85% (who will be harder hit than the privileged few) or to continue remaining silent but under our breath, curse the UMNO/BN system of governance for our woes?

Will you take the trouble to understand GST and all its implications for the country or will you simply shrug your shoulders and say "qua sera sera"?


As the representatives from PR said, they are not against GST per se. They only oppose it because GST should be a last measure which will inevitably bring more hardship on Malaysia's poor when other measures to curb the leakages and corruption has not been explored yet, really explored with political will even if it means undermining the "base" on which the ruling elites depends on to remain in power.

Sad isn't it when we all (ruling elites included) know that we as a nation is in serious trouble but are are unwilling to make a righteous move to correct it. Why? All because of power, fear, and the need to keep our stomachs full.

The forum ended at 10.30 pm and as I left the venue to get some dinner, I couldn't help but thinking we are in for some hard and tumultuous times (which might tear at the very fabric of our multi-racial society) if this GST is not postponed until UMNO/BN and their broken way of governance is put to a stop.

As YB Dr Dzulkefly Ahmad put it, the insistence of the BN government to go forth with the implementation of GST would be a boon to PR, much more than the jailing of Anwar could in Sodomy 2! So then why are they trying so hard to educate ordinary Malaysians to rise and protest against GST? Wouldn't it be better if they let UMNO/BN bite the rakyat where it hurts most and pave the way for PR to Putrajaya?

The sad fact is whilst those like I who want to see an end to racial politics of the UMNO/BN kind, also realizes that it may be too late then when the 65% debt ratio is breached come when PR inherits the federal government at the next GE.

Such is the complexity of Malaysian politics and governance that we the poor electorate is forever asked to juggle between real and propaganda. Tough shit really when both sides overplay their hands without care for the rakyat who only want simple truths!

Anyway in closing, when I left the forum at 10.40 pm, I felt that I was much the wiser for having attended the forum and whilst still believing that a GST form of taxation is the way forward for Malaysia, I concede that we must defer its implementation so long as UMNO/BN are not willing to sacrifice themselves so that Malaysia could prosper for the sakes of us all.

I will from henceforth, devote a large portion of my blog to GST and all its implications until those who fear it most do the right things to prevent hunger on a widespread scale which will inevitably be played up on the racial scenario.

All I can say is watch your pockets and and remember how much debt you want your descendants to carry. Please don't come complaining to me when you have to pay more for your "char koay teow" when the shit hits the fan!

The onus is upon us and are we that stupid not to see all the warning signs of an economic policy gone wrong?

I refuse to be stupid anymore even if it means I have to "thump" table with friends who are seduced by Najib's 1 Hollow Malaysia!

Ps. Doc Edu, this is only 25% of what I have to say about GST! You know what I mean without being long winded, I hope! 1Malaysia? IT IS AN ILLUSION!

A very sad illusion! Which those from our midst still can't see! Know what? I don't blame them but ourselves for not being able to to convince those whom we see daily!!!

Perhaps it is time time to change our "friendship" protocol?

Pop the Champagne Guys!!!

PKR sacks Zul Noordin

By Clara Chooi

PETALING JAYA, March 6 — PKR sacked its controversial Kulim-Bandar Baru MP Zulkifli Noordin (pic) today in a move to rid the party of a lawmaker who has become a major liability for the Pakatan Rakyat (PR).

The decision was reached this evening when the party’s supreme council decided to endorse the recommendations made by the disciplinary board.

The council convened a meeting from 3pm this evening to deliberate on the board’s investigation report, which was completed yesterday.

The rebel MP was referred to the board for infringing a party gag order by lodging a report against Shah Alam PAS MP Khalid Samad over the “Allah” row and for his criticism of DAP’s Lim Guan Eng.

He was one of the few MPs expected to join the likes of Datuk Seri Zahrain Hashim, Tan Tee Beng and Mohsin Fadzli Samsuri, who recently resigned to become Independents.

Zulkifli has been adamant about not wanting to quit, telling the media that he wanted to stay on to fight his case.

When party affiliations don’t matter, personal manifestos should

from MalaysianInsider:-

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Zeffri Yusof is an ex-journo and all-round informavore. Zeffri believes in the force of Reason, human goodness and dignity, and the "machahood" of man. He's on and off ontwitter.com/zeffri

When party affiliations don’t matter, personal manifestos should

MARCH 5 — Thanks to s**t stirring MPs like Zul Noordin and “newly independent minds” like Tan Tee Beng, Datuk Seri Zahrain Hashim and Fairus Khairuddin, one can hope that the majority of Malaysian voters have been taught a lesson they won’t soon forget.

For the next time we visit the ballot box, let’s demand some well-in-advance straight answers from our running candidates because it’s evident that we can’t rely on some of them to keep their story straight (hey, some might mistake it for integrity).

It may be naive of me for even suggesting it, but it seems that far too many of our MPs don’t share the basic principles of the political parties they represent.

How else can we explain the fact that BN only needs seven more MPs to cross over to regain its two-thirds majority?

But perhaps I ask too much. What has also been made abundantly clear again earlier this week is that the entire Pakatan Rakyat coalition filled up their candidacy roster in the last general election with whatever they could muster — quality ... and in certain cases, ability and decency, be darned.

It’s obvious that for MPs like Zul Noordin, the official position and manifesto of the coalition he happens to represent do not even come into play. I can only imagine how he gleefully decided he was going to run for his own private reasons, rode the popular sentiments at the time, and duly got lucky.

I say lucky because unkind commentators have already said it: letak tunggul kayu pun boleh menang — such was the tsunami of opinion at the time of the 12th general election.

The injustice is compounded when the voting public — his voters — are screwed because we only gain insight into his position on pressing issues of the day much, much later; “after” he gets elected and decides to go all maverick on us (no, not like Tom Cruise in “Top Gun”; besides his B2 licence ride doesn’t qualify).

As disgruntled voters, we can hold out in hope that once all the s**t stirring, frog jumping and trimming of fat is done; the real lean muscle (can I call it the phat?) are the ones left over to continue for the next GE.

Moving forward from this daily unfolding debacle (soon, I hope), I believe it’s only fair that all right-minded MPs, ADUNs and would be candidates-for-office declare, in advance, their principles and personal manifestos to the voting public.

In the age of free blogging resources, Facebook and Twitter — and with 68 per cent of Malaysians using the Internet and over 90 per cent on cellular phones — this shouldn’t prove very hard. Because as voters we deserve to know, damnit.

We want to discern the wheat from the chaff, so that if and when our MPs decide to screw us later, we can turn around and call them out for the liars and chumps that they are.

So here’s a sample voter’s request for MPs and candidates: at the very least, put down clearly where you stand on the following core issues:

1. Secular separation between religion and state; or theocracy with syaria law?

2. Equality of all Malaysians regardless of ethnicity, sex and sexual orientation; or special positions for some?

3. Affirmative action for all underprivileged citizens; or selective affirmative action for a majority?

4. Opinion and stand on Bangsa Malaysia; opinion or stand on “Ketuanan Melayu”.

5. Freedom of religion, including freedom “from” religion, and what you understand by it.

6. View on detention without trial.

7. View on freedom of speech, including a free, independent media.

8. View on the Parliament, executive, judiciary and royalty.

I would argue that knowing a candidate’s stand on all of the above is infinitely more important than whether he or she is BN or PR because what is also equally evident by now is that we do not have clearly delineated teams in our political sphere.

A political coalition is only as good as its common ground and, guess what, denying BN its two-thirds majority is not a long-term common ground. Surprise, surprise — by now none of the component parties in both PR and BN has any more common ground left.

For how else can you explain Umno and PAS disagreeing on Ketuanan Melayu, yet pally pally for enacting firmer syaria laws? Or DAP, PAS and MCA sharing the same opinion on the Allah issue, or Umno in Perak forgetting its past history with the institution of royalty.

So yes, we are going to demand to know our candidate’s principles and their stance on all of those important issues — including their reasons — because, hey, voters also want to know if their candidates have actually put some modicum of thought into what they stand for (or perhaps I am asking for too novel a concept)?

Lest we forget: the people are the boss. We deserve to know whether our candidates are actually representing their party, or just there to party.

* The views expressed here are the personal opinion of the columnist.

The courts' 'Yg Arif' might say, "Potato Chips, of course!!"

Some months ago, my learned friends, Fahri Azzat and Amer Hamzah appeared in the Court of Appeal to argue an appeal. They were representing a man who was found guilty of sodomising a boy. He was sentenced to 60 years of imprisonment and 22 stroke of caning although he maintained that the sodomy acts were consensual.

During the appeal, the two lawyers brought up constitutional issues which have never ever been brought up before. As these issues were never brought up before, it follows that there has never been any judicial pronouncement on those constitutional issues. Those issues are:

• the law provision which makes the act of sodomy is unconstitutional as it transgresses the right to privacy, which is a part of our fundamental liberties;
• the act of criminalising and penalising the act of sodomy, when it is consensual, amounts to an act of discrimination and inequality, especially against men with homosexual tendency. As discrimination on the basis of, among others, gender, is prohibited by the Constitution, it follows that the criminalisation of consensual sodomy is unconstitutional;
• the caning sentence is also discriminatory in nature as under the law women cannot be caned.

Now, I am not going to touch on whether the arguments were correct or not. But these arguments were taken up for the very first time in our legal history. Furthermore, they were taken up in the second highest Court of the land, namely, the Court of Appeal.

It goes without saying that the Court of Appeal should have seen it fit to hear the arguments in totality. Then it should consider the arguments in depth. Then it should decide on the arguments. After that, it should write a proper and well reasoned grounds for its judgments so that the people know what it was thinking and how it came to such thinking.

That decision would have been one of the most important decision in our Constitutional law. It will serve as a precedent and as a guideline to all of us Malaysians, to the police, the AG Chambers, to legal practitioners, law lecturers and law students alike.

Guess what happened? Fahri was cut short in the middle of his constitutional issues/points. The learned Judge asked him to stop arguing midway through his arguments. He was asked to go to the next point. After hearing the both of them, the Court of Appeal dismissed their case there and then.

Quite obviously, the Court of Appeal did not think much of the various constitutional issues - which touched on the people's constitutional rights - which were raised for the first time.

It was reported that one of the learned Judge said, "are you saying that (homosexuality) among consenting adults is legal? In other words, what happens in the bedroom is none of the government’s business?" during the hearing.

Needless to say, no written judgment was given until the time I am writing this (5th March 2010).

As that particular criminal matter originates from our Sessions Court, no further appeal to the Federal Court could be made.

In my opinion, the failure to give a reasoned judgment in a matter involving such important constitutional issues is a loss opportunity. It reflects a nonchalant attitude towards every argument which is deemed "new" or "unconventional" by the Court.

We are therefore stuck in conservatism and the law - which is supposed to develop as time passes by in order to reflect a currency of approach - lies stagnant within the robes and wigs that Judges wear.

On the other hand, the Court of Appeal in the UK sat to hear a question on whether the snack product Pringles is similar to a crisp and made from the potato and therefore subject to standard-rate VAT.

After a long and laborious arguments, the UK Court of Appeal considered what was branded as an "Aristotelian question" and came up with a judicial pronouncement which is not only well reasoned but also a delight to read.

The learned Judges thought that "the issue of classification should not be given an “over-elaborate, almost mind-numbing legal analysis”. The report on that case went on to say:

Lord Justice Mummery, agreeing, noted the “urbane” submissions of Cordara (the Queen Counsel representing Pringles), which referred to “the potato as a fiscal contaminant” and drew attention to the “essential characteristics of the paradigm potato crisp”. The judge rejected the argument that Pringles also have 33 per cent fat, and if a product has a number of significant ingredients it cannot be said to be “made from” one of them. Lord Justice Mummery pointed out that “most children, if asked whether jellies with raspberries in them were ‘made from' jelly, would have the good sense to say ‘Yes', despite the raspberries”.

The report on that potato chips case can be found here.

And so there we have it.

In Malaysia, questions on the constitutionality of the criminalisation of homosexuality and the punishment of caning are just brushed aside without any known reason.

But in the UK, the Court of Appeal had sat to hear "Aristotelean question' on what constitutes potato chips and came up with a written and well reasoned judgment on that question.

Sodomy, caning and potato chips. Which one is more important?

Abdul Gani’s decision not to press charges against Al-Islam reporters without extracting public apology indefensible and dangerous precedent inimical to 1Malaysia concept

Abdul Gani’s decision not to press charges against Al-Islam reporters without extracting public apology indefensible and dangerous precedent inimical to 1Malaysia concept

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Statement by Tengku Razaleigh Hamzah

Statement by Tengku Razaleigh Hamzah

I think Umno should apply this gag order properly and, from today onwards, also stop altogether talking about Allaryaham Tun Razak (Hussein). Umno Baru would consider him a traitor.

For it was he who ordered me to design the Petroleum Development Act in such a way that the Malay heartland states of Kelantan, Terengganu, Johor and especially his beloved Pahang, would benefit directly from offshore oil beyond three nautical miles through the mechanism of 5 per cent cash payments made directly to the state consolidated fund. What a troublemaker he was.

It is this same payment, that Umno Baru insists, through every government channel, that Kelantan and Terengganu have no right to receive, on the grounds that the oil is found beyond 3 nautical miles offshore.

Naively, Tun Razak did not forsee that Umno Baru would have better uses for this money than the impoverished Malay folk of the East Coast.

More than RM20 billion has been paid out in Terengganu’s name over the years, yet the people of Terengganu remain impoverished because the money has not gone to them.

They are expected to console themselves watching millionaires frolic in yachts and admiring a crystal mosque they cannot pray in.

We should also put a gag order on speaking about the late Hussein Onn. He, at least, was a man of principle, and an absolute enemy of corruption and the abuse of power. He was such a threat to Umno Baru that he, like the late Tunku Abdul Rahman, was shut out from it, and died outside the party.

Tengku Razaleigh Hamzah
Member of Parliament, Gua Musang

The Contemporary Malay Dilemma

The Contemporary Malay Dilemma
By faroukaperu

I read Tun M’s ‘Malay Dilemma’ in secondary school and didn’t think much of it then (I suppose I was too immature). I then read, about 10 years later, Bakri Musa’s ‘The Malay Dilemma Revisited’. Bakri’s scathing critique of the government’s policies and race and the negative aspects of Malay culture stays with me till now. Now, about 9 years after reading Bakri, another favourite Malay thinker of mine, Azly Rahman’s opined about the Malay Dilemma in his blog yesterday.

Azly, in his ‘The Newest Malay Dilemma’, believes that the real malay dilemma is about mind control. How we’ve been sold a bill of goods about slogans and visions all designed to blur us while we’re still being exploited by robber barons and emerging dynasties. I concur with this but wish to add, if I may, my two cents.

To me, Tun M, Bakri and Azly have put forward good points in their works but if you ask me, what is the Malay dilemma, I would have to say our dilemma is our positions on race and religion. We have effectively become the most bigoted people in the world, even daring to ban others from using words to express their faith.

Why are race and religion a dilemma at all? They don’t have to be but they are for the very simple reason of politics. In our political expressions, the Malays are limited to the racialist UMNO and the religious fundamentalists PAS or the ill-fated PKR (who are still full of UMNO and PAS types as well). Our politics is never about policy. It’s about identity. We constantly flex our imagined political muscle to the non-Malays and non-Muslims because our politicians tell us to do so. In the meantime, outrageous amounts of money flow into certain pockets while many Malays are still mired in poverty. Yet when it comes to ‘hak orang Melayu’ or ‘mempertahankan Islam’, we still see Malays dutifully doing their bit for these reprobates.

Truly, we are puppets in their dastardly scheme.

What do we need to do to get over this dilemma?One solution I would say is phrased in a word, PRIVATISATION. While the word seems to have a different connotation than the usual privatisation of the utility agencies for example, the effect remains the same. Rather than the government styling itself as they protectors of race and religion, we need to have a government that is completely neutral in such matters. All at once, we will render race and religion ‘organic’ in the sense that proponents of such ideologies would understand the realities of economics and rethink their activities. Even racists and religious fundamentalists need to buy stuff and they’re not paid for things like BTN or religious classes, we’ll see how many volunteer.

Secondly, we need to make it obligatory for any political party to adopt a policy of non-discrimination for membership. This is what I call the Onn Jaafar effect. Onn Jaafar wanted to open UMNO membership to non-Malays but was overturned and forced to leave. It does seem unimaginable but once this happens, we will find a sweeping political and religious reform overtake the nation. Those people who rely on cheap racist and religiously bigoted slogans would be simply neutralised.

Thirdly, we need to have language and religious education that understands the realities of Malaysia. All Malays should learn English, Mandarin and Tamil up to at least conversational level. Besides that we need to take classes about other religions than Islam. We need to understand that other people value their respective faiths too and our bigotry tends to overlook that.

Lastly and I think most importantly, we need to implement philosophy as an actual subject in secondary schools. Philosophy equips us with the thinking tools we need to see through the puppetry of our politicians. Moreover, it gives us the ability to constantly grow as individuals who can negotiate their way through any reality which confronts them.

The dilemma of the Malay to me is this crippling position we have on race and religion. We still cling to this Ketuanan myth and live the Hobbesian fear of ideological attacks at every turn. In truth, we are potentially rational beings as any Malaysian or human being. We simply need to leave these myths behind and embrace the truth about ourselves.