KUALA LUMPUR 20 August 2026: Prime Minister Datuk Seri Anwar Ibrahim has ruled out the possibility of reinstating the Goods and Services Tax (GST) as Malaysia’s main tax system, saying a broad-based consumption tax could place an unfair burden on lower-income groups.
Speaking to the media after attending the TikTok Shop Summit 2026 today, Anwar said any changes to the country’s tax system must remain consistent with the government’s commitment to social equity and protecting vulnerable groups.
He said the government could consider improving the existing Sales and Services Tax (SST) or adopting selected components of the former GST system, but stressed that increasing the tax burden on poorer Malaysians was not an option.
Anwar said the government is currently examining the possibility of a hybrid tax model that combines elements of SST and GST to create a more efficient revenue system without placing excessive pressure on the public.
Finance Minister II Datuk Seri Amir Hamzah Azizan has been tasked with leading a feasibility study on the proposed model.
The discussion comes amid efforts to broaden Malaysia’s tax base, increase government revenue and address fiscal pressures. However, Anwar maintained that any tax reform must take into account the people’s income levels and cost-of-living pressures.
Malaysia introduced GST at a rate of six per cent in 2015 before the tax was abolished in 2018 following a change in government. The country subsequently returned to the SST system.
The possibility of bringing back GST has resurfaced in recent years as the government looks for ways to strengthen public finances, but Anwar’s latest remarks indicate that a full return to the broad-based tax is not currently being considered.
-malaymail
