"GST : Tax Implication for Green Technologies in Malaysia "

25^TH December 2009

Over the past few weeks, the public debates for and against GST has seen diverse inputs from both camps-advocates("Govt studied GSTs of 143 nations", NST, 2009/11/30) and their critics("Taxes: The GST road to high prices", NST, 2009/12/22 and "Taxes: Think hard on GST move", NST 2009/11/27).

I believe the government will seek for full implementation of the GST by the year 2011 according to its studies -if not earlier. In this regard and with reference to the news report "No double taxes, says minister" (NST, 2009/12/21), there is a need for the government to include in its studies the tax component impact as well in the context of green technologies and renewable energy paradigm.

Even the recent Green Technology Policy(GTP) and the accompanying Renewable Energy Policy & Action Plan(REAP) roadmap did not take into account this crucial component.

To-date, there is also no indication at all from the government (and no studies have been undertaken in this specific area according to the writer's understanding) to gauge the serious implication and effectiveness of GST vis-vis R&D of green technologies and renewable energy equation in Malaysia .

Hence, it is advisable for the Ministry of Finance to take this into serious account before seeking full implementation of the GST within the Green Technology Policy(GTP) and Renewable Energy Policy & Action Plan(REAP) roadmap implementation phases.

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Jeong Chun-phuoc*
Lecturer-in-Law
and a reader in Strategic Tax Intelligence(STI)
He can be reached at : Jeongphu@yahoo.com