Monday June 25, 2012
Other factors need to be considered before taxes can be reduced, says Ahmad Husni
IPOH: The reduction of corporate and individual taxes requires more than just a discussion with focus groups, Datuk Seri Ahmad Husni Hanadzlah said.
The Second Finance Minister said several other factors, including the Government's operating surplus and its debt-to-gross domestic product (GDP) ratio, should also be taken into account.
“It is not something we can easily decide,” he said after opening the 100th Mydin store in Manjoi here yesterday.
“It has to be based on mathematical calculations.”
Ahmad Husni, commenting on calls for the reduction to both taxes, said the Government had to look into the country's overall financial position, in addition to finding ways to stay prudent in managing its finances.
“There are balancing acts that need to be carried out in order to determine whether the reve- nue we generate is balanced with our expenditures.
“We need to obtain the operating surplus, reduce the fiscal deficit and debt-to-GDP ratio, which is currently at about 53% and is slightly lower than the recommended 55%,” he said.
Ahmad Husni also pointed out that the fiscal deficit recorded last year was about 4.8% of the GDP and that it was expected to improve to about 4.3% this year.
“We hope to reduce it to 3% by 2015.
“All these factors should be thoroughly studied before we determine any tax deductions,” he added.
On another matter, Ahmad Husni said the first focus group discussion on Budget 2013 had begun, with members giving numerous views on ways to make it better.
“We will study all the ideas and memoranda submitted by the focus group. It will become clearer after the meeting,” he said, adding that the ministry would then look into translating the ideas into actions.