20100316 0942 Malaysian Economic News.

The postponement of the second reading of the Goods and Services Tax (GST) bill does not mean it is a “no go” as it will eventually have to be implemented, said chairman of the tax review panel at the Finance Ministry Datuk Kamariah Hussain. “

• The way forward” for the ministry was to take the opportunity to go on more roadshows to raise public awareness on the need for GST, which would work together with the Federation of Malaysian Manufacturers (FMM) and the SME Corp, she added. (Financial Daily)

Goods and services offered by the financial sector will be exempted from the government’s proposed Goods and Services Tax (GST) because it is “difficult to tax”, chairman of the tax review panel at the Ministry of Finance Datuk Kamariah Hussain said.

• This was following the precedent set by countries like Singapore and New Zealand which did not impose GST on the finance industry. She added that it will be a challenge for the government to ensure all (cost) savings are passed on to the consumers. From the experience of other countries, it is a one-off kind of price increase. (Financial Daily)

The government should return to the global bond market for the first time in almost eight years to set new benchmark borrowing costs for the nation’s companies, according to the central bank. “Malaysia has not tapped the international capital market for a long time, whether in conventional or sukuk bonds.

• Therefore, we have encouraged the government to do so because it’s important to have the Malaysian name in the market as well as to create a benchmark for other corporates.” Governor Zeti Akhtar Aziz said. (Bloomberg)

Yang di-Pertuan Agong Tuanku Mizan Zainal Abidin said that the New Economic Mode (NEM) to transform Malaysia into a high-income and developed country is a “visionary move” by the government. The giving of subsidies will also be restructured and reduced in stages.

• “However, the target groups, like the poor, would continue to receive aid to ensure that they were not burdened. We call on the people to be far-sighted and be prepared to accept this change," he said. (Bernama, Financial Daily)

China's Ambassador to Malaysia, Liu Jian, says expansion of trade and investment between Malaysia and China is top priority for him this year as several trade agreements, including its free trade pact with Asean, come into force. He expressed confidence that the full implementation of the China-Asean Free Trade Area (FTA) this year would accelerate economic development between China and Malaysia. (Bernama)