GST

GST. One of the hot topic in the politic 'world'. Some say it is good for the economic, some say it is bad for lower class and some even say that it is just the same as the old goverment tax. So really, what is GST that managed to turn people's world upside down.

What is GST?

GST (Goods & Services Tax), which is also known as VAT or the value added tax in many countries is a multi-stage consumption tax on goods and services.

GST is levied on the supply of goods and services at each stages of the supply chain from the supplier up to the retail stage of the distribution. Even though GST is imposed at each level of the supply chain, the tax element does not become part of the cost of the product because GST paid on the business inputs is claimable.

Hence, it does not matter how many stages where a particular good and service goes through the supply chain because the input tax incurred at the previous stage is always deducted by the businesses at the next in the supply chain.

GST is a broad based consumption tax covering all sectors of the economy i.e all goods and services made in Malaysia including imports except specific goods and services which are categorized under zero rated supply and exempt supply orders as determined by the Minister of Finance and published in the Gazette.

The basic fundamental of GST is it's self-policing features which allow the businesses to claim their input tax credit by way of automatic deduction in their accounting system. This eases the administrative procedures on the part of businesses and the Government. Thus, the Government's delivery system will be further enhanced.

GST Mechanism - Standard Rated

Retailer (You) is not GST registered

GST 6%

Sales Price Rm100,000 Sales Price RM150,000 Sales Price RM175,000 Assume manufacturer's GST for purchases is RM2,000 Add GST 6% RM6,000 Add GST 6% RM9,000 Add GST 6% Not applicable Total RM106,000 Total RM159,000 Total RM175,000 Input tax credit RM2,000 Input tax credit RM6,000 Input tax credit can't claim GST remit RM4,000 GST remit RM3,000 Cost increased RM9,000 (6,000-2000) (9,000-6000) Cost increased N/A

• You can't claim back for the RM9,000 of GST you paid to your wholesaler.
• You can't charge GST on consumer.

Scope and Charge

 

GST is to be levied and charged at the proposed rate of 6% on the value of the supply. GST can be levied and charged only if the business is registered under GST.

 

GST shall be levied and charged on the taxable supply of goods and services made in the course or furtherance of business in Malaysia by a taxable person. GST is also charged on the importation of goods and services. A taxable supply is a supply which is standard rated or zero rated. Exempt and out of scope supplies are not taxable supplies.

GST is to be levied and charged at the proposed rate of 6% on the value of the supply. GST can be levied and charged only of the business is registered under GST. A business is not liable to be registered of its annual turnover of taxable supplies does not reach the prescribed threshold.

Therefore, such businesses cannot charge and collect GST on the supply of goods and services made to their customers. Nevertheless, businesses can apply to be registered voluntarily.

Types of Supply

 

1.      Standard-rated supplies

Standard-rated supplies are taxable supplies of goods and services which are subject to a proposed rate of 6%. A taxable person who is registered under GST has to collect GST on the supply and is eligible to claim input tax credit on his business inputs in making taxable supplies.

2.      Zero-rated supplies

Zero-rated supplies are taxable supplies of goods and services which are subject to GST at zero percent rate. In this respect, businesses do not collect any GST on their supplies but are entitled to claim credit on inputs used in the course of furtherance of the business..

3.      Exempt supplies

Exempt supplies are supplies of goods or services which are not subject to GST. In this context, businesses do not collect any GST on their supplies and are not entitled to claim credit on his business inputs.

4.      Supplies not within the scope of GST

Supplies which do not fall within the charging provision of the GST Act include non-business transactions, sale of goods from a place outside Malaysia to another place outside Malaysia as well as services provided by the Government sector.

Why GST instead of other higher tax ?

 

GST is a better and fairer tax system compared to SST (Sales & Service Tax) as GST will :

1.      Lower business cost

Under the current system, some business pay multiple taxes and higher levels of tax-on-tax (cascading tax). With GST, businesses can benefit from recovering input tax on raw materials and incurred expenses, thus reducing costs.

2.      Increase global competitiveness

Prices of Malaysia exports will become more competitive on the global stage as no GST is imposed on exported goods and services, while GST incurred on inputs can be recovered along the supplies chain. This will strengthen our export industry, helping the country progress even further.

3.      Enhance compliance

The current SST has many inherent weaknesses making administration difficult. GST system has in-built mechanism to make the tax administration self-policy and therefore will enhance compliance.

4.      Reduces red tape

Under the present SST, businesses must apply for approval to get tax-free materials and also for special exemption for capital goods. Under GST, this system is abolished as businesses can offset automatically the GST on inputs in their returns.

5.      Equity

With GST, taxes are leveled fairly among all the businesses involved, whether they are in the manufacturing, wholesaling, retailing or service sectors.

6.      Fair pricing to consumers

GST eliminates double taxation under SST. Consumers will pay fairer prices for most goods and services compared to SST.

7.      Greater transparency

Unlike the present sales tax, consumers would benefit under GST as they will know exactly whether the goods they consume are subject to tax and the amount they pay for.

Not Subject to GST

 

We do not pay GST on goods / services which are:

·         Zero-rated supplies

·         Exempt supplies

Zero Rated Supplies
These are taxable supplies that are subject to a zero rate. Businesses are eligible to claim input tax credit in producing these supplies, but cannot charge output tax to the consumer.

Exempt Supplies
These are non-taxable supplies that are not subject to GST. Businesses are not eligible to claim input tax credit in producing these supplies, and cannot charge output tax to the consumer.

Benefit to Consumers

Suppliers,manufacturers,wholesalers and retailers are able to recover GST incurred on inputs. This reduces the cost of doing business, thus enabling fairer prices for consumers. 

Certain basic goods and services are not subject to GST for socio-economic objectives. These include basic foods, residential accommodation, education, health services, public transportation, and domestic consumption of water supply and electricity up to a certain limit.

THREE THINGS I'D CHANGE IF I RULED THE WORLD

What an interesting topic this is. THREE THINGS I'D CHANGE IF I RULED THE WORLD! There are a lot of things I would love to change. Unfortunately, I was given only three. So, after a lot of thinking has been done, these are the one that I have chosen. 

The first thing thing that I will change is the law. I will make sure that nobody on this planet would be discriminated against ever again. I will accomplish this by changing/abolish prejudice laws that have been making countless peoples´lives a living nightmare I will also ensure that constitutions would be required to follow international equality laws that would obligate governments to respect people unconditionally.  I will gather all the world leaders, make them legalized regulations and agreement for fighting corruption, and make sure they have socialize the regulations to related staffs and practice it properly. Punishments for corruption criminals are included in the rules. 

The second thing that I would love to change is the education. I will provide better education on all levels, such as granting those whom have excellent grades to full scholarships in order to have equal opportunity employment and condition those students to give back to society by completing volunteer work for a minimum of 2 years. By education, I would change the attitude of people. I will try my best to educate them, because we can’t think of devlopment / progress unless we have proper knowledge. knowledge will help us to take decision in life. Once they understand the power of education, they will educate themself .

The third one is…I sure a lot of people would protest…Is banning cigarette. First, smoking develops cancer, and there is more than 4000 toxic chemicals inside a cigarette. Also, the nicotine inside is very addictive. Second, smoking is also very harmful to other people. People around a smoker can also smoke by second hand smoking. What Is Secondhand Smoke?
When you breathe in smoke that comes from the end of a lit cigarette, cigar, or pipe (sidestream smoke) or that is exhaled by a smoker (mainstream smoke), you're inhaling almost the same amount of chemicals as the smoker breathes in. Tobacco smoke contains more than 4,000 different chemical compounds, more than 50 of which are known to cause cancer. These are just a few of the chemicals that float into your lungs when you are exposed to secondhand smoke:

·         Hydrogen cyanide -- a highly poisonous gas used in chemical weapons and pest control
·         Benzene -- a component of gasoline
·         Formaldehyde -- a chemical used to embalm corpses
·         Carbon monoxide -- a poisonous gas found in car exhaust

A 2006 surgeon general's report confirmed that secondhand smoking (also called involuntary or passive smoking) can kill, and it concluded that there is no amount of exposure to secondhand smoke that is safe. The more secondhand smoke you breathe in, the more your health risks increase. Also, the government spends thousands of dollars in curing people sick by smoking.Because of these reasons, I believe we should ban smoking.
 

In conclusion, I will make this world a fair place to live in and I will abolish all types of hate crimes with prevention through proper, free education, provide rehabilitation for those whom just can’t seem to get out of poverty, and retribution of the soul from those whom have access to education and equal opportunities to those who unfortunately aren’t as lucky.

The Independence Day

The Independence Day is an annual celebration by the whole world but in Malaysia we specifically call it  as a 'Merdeka Day'. All countries honour their respective independence day, celebrating it as  a national holiday. Thus, on the 31 August every year, it is marked as the Malaysian Independence Day .

Parade on Merdeka Day

The first Prime Minister of Malaysia, Tunku Abdul Rahman Putra Al-Haj spearheaded the effort for independence, leading a delegation of ministers and political leaders of Malaya (now Malaysia) in negotiations with the British in London for Merdeka, or Independence. Just when it became clear that the Communist threat posed during the Malayan Emergency was getting out of hand, agreement was reached on February 8, 1956, for Malaya to gain independence from the British Empire. But for some reason it was decided that the official proclamation of independence would be made the next year, on August 31, 1957, at Stadium Merdeka (Independence Stadium), in Kuala Lumpur. 

On this glorious day Allahyarham Tunku Abdul Rahman proudly declared the independence day of Malaysia by shouting out "Merdeka" seven times at the Merdeka Stadium. Hari Merdeka meaning the Independence Day is the national day of Malaysia commemorating the independence of the Federation of Malaya from British colonial rule.

The historic moment at Stadium Merdeka

Thousands of people at Stadium Merdeka

As malaysians we should appreciate the freedom that we achieved because it is not easy to have what we got now. So, now its our duty to preserve the peace that we have achieved .

Moral of the story .. we should proud to be Malaysians !! :D

The Things That I Cannot Live Without ....

Hello .

I want to share about something based on the topic above today.

Anyone that live in the world have their own life. It means each of us got something that 

important in our life. Based on the topic of The Things That I Cannot Live Without , people in the

world need something that they cannot live without. Either living things , neither non-living things.

In my life , there are something I cannot live without. That things are my family.

Without family logically I cannot live in the world. Haha. Without my family , how can I born into the world. 

Below is the picture of my big family:

Family it the first thing that I cannot live without. Family is my precious things that I have.

With my family , I had good condition of my life. Nothing can compared to the best family I had.

A month of Hari Raya were the best as we goes to the other family member such as , my uncle, my nephew , and many other that had relay with my family. When all the family gather together , it will bring so much fun . :D

Next , the thing that I cannot live without is money. Apparently , money is quite important these days. I had a situation as I were place in a hostel of a school. I ran out of budget because of buying something that not useful such as credit topup , sweets and junks, and expensive foods. Its all the thing that I had waste my money on it. 

Without moey at that time were make my condition worst. I need to pay club fee , need to buy food, and pay anything that important. I had no choice , so I lent from my friends and later on the next week I will pay back. Moral is money is important , so use it wisely . 

Thats all. Thank you for reading . 

Goodbye . :D

Selamat Hari Raya

Fireworks heard everywhere in my neighbourhood from days or even weeks before the Hari Raya celebration. It may be disturbing when some fireworks were set off on the late-night hours when most have already been sleeping, but it’s okay since their major festival is approaching and that it is normal to play fireworks to build up the festive mood. But isn’t fireworks are illegal in Malaysia? People still can buy it and play. Who cares….! If no fireworks, things would be too quite, and there wouldn’t be Raya atmosphere around.

The time has come. The Ramadhan month is over and the Muslims have successfully finished their fasting over this one-month period. I do really admire their faith and wisdom on Islam for being able to not consuming any food or drink in a lengthy period of time everyday for the past month. For me, I think I couldn’t stand the hunger and the thirst, as well as the lack of energy. Fasting is a good practice, and it somehow helps Muslims to save money too (skipping lunch everyday).

Anyway, I would like to take this opportunity to wish all my Muslim friends particularly in Malaysia a very wonderful and joyous Raya celebration! Selamat Menyambut Hari Raya Aidilfitri! Maaf, Zahir dan Batin. By this time, I believed many have already went back to their hometown (sudah balik kampung) safely. Time to gather, chill and celebrate together with your family, relatives, neighbours and friends on this wonderful festival! In the meantime, I’m sure KL would be quite empty except than seeing Chinese or Indians, and mostly foreigners wondering the streets nowadays. I’m currently on a short family vacation at Bali, Indonesia. Will be updating my blog with highlights from my Bali trip once I returned to Malaysia.

On the other hand, for other Malaysians who are not celebrating this festival, a big Happy Holiday greeting to you too! This week offers perfect opportunity for trip (like me), outings or simply rest at home after spending over half of the year working, working and working! Enjoy la….Many must be taking additional leaves up till the end of this week too. So, you would have over a week of break! Awesome!

Last but not least, I would like to sincerely wish every Malays once again ‘Selamat Hari Raya Aidilfitri!’.