Government to retain SST, may adopt certain GST components

The Malaysian government has no plans to reintroduce the Goods and Services Tax (GST) in its original comprehensive form, Prime Minister Datuk Seri Anwar Ibrahim announced. However, the administration remains open to integrating certain components of the GST system to enhance the current Sales and Service Tax (SST).

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We can make some adjustments or improve SST and even adopt some GST components if necessary. But the main principle of the Madani Government is not to impose taxes on the very poor. Therefore, GST as a principle cannot be considered.

Anwar emphasized that any modifications to the national taxation system must prioritize the welfare of the people, particularly low-income individuals and the poor. He indicated that the SST could be adjusted, and elements of the GST could be adopted if these measures streamline the country's tax framework. The core principle of the Madani government, he stressed, is to avoid imposing taxes on the extremely poor.

"We can make some adjustments or improve SST and even adopt some GST components if necessary," Anwar told reporters after officiating the TikTok Shop Summit Malaysia 2026. "But the main principle of the Madani Government is not to impose taxes on the very poor. Therefore, GST as a principle cannot be considered."

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I am not prepared to consider the main basis of GST because it is a comprehensive tax imposed on all citizens, including the poorest.

Regarding potential taxes on electronic payments, Anwar stated that any such proposals would undergo thorough evaluation within the national taxation framework. The government aims to maintain a fair and targeted approach to taxation to strengthen national revenue without compromising the well-being of low-income citizens. He assured that efforts to boost national revenue would be balanced with the need to protect vulnerable groups still facing cost-of-living pressures. The government will continue to assess the best methods for improving the national tax system, including enhancing the SST based on current needs.

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The important thing is that we want a better, fairer tax system that does not burden those who need it most.