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GST refund shortfall more than we thought: Malaysia finance minister

GST refund shortfall more than we thought: Malaysia finance minister

Malaysia's new finance minister Lim Guan Eng attending a press conference in Kuala Lumpur on May 10, 2018. (Photo: Roslan RAHMAN/AFP)

KUALA LUMPUR: The shortfall in Goods and Services Tax (GST) refunds totalled RM19.2 billion (US$4.7 billion) as at May 31 this year and not the RM17.9 billion stated last week, Malaysia's finance minister Lim Guan Eng said on Monday (Aug 13).

Lim had earlier reported that the previous administration had failed to pay input tax refunds within two weeks after submission of proper documents.

He said verified records of the Royal Malaysia Customs Department show that GST refunds stood at RM19.2 billion as at May 31 this year. 

“Of this RM19.2 billion, RM9.2 billion was from 2018, RM6.8 billion from 2017, RM2.8 billion from 2016 and RM0.6 billion from 2015,” he said in Parliament.

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Lim attributed the shortfall in funds approved for GST refunds to weak cash flow by the previous federal government brought about by poor fiscal discipline, widespread wastage and widening debts.

“What the previous administration actually did was to falsify accounts and misappropriate the funds for other purposes or to cover the deficit so as to show a surplus,” he said.

On Aug 9, Lim said the balance in the Refund Trust Fund was only RM1.486 billion as at May 31, 2018.

“Actually, the amount left in the Refund Trust Account was about RM148.6 million only, and not RM1.486 billion as announced last week.

“This was due to an unintentional mistake by an officer in my office who displaced a decimal point,” he said.

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