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Malaysia scraps GST, experts advise caution to Indian govt

India studied the Malaysian model before implementing the GST and borrowed the anti-profiteering clause to ensure GST benefits are passed on to the end-consumer by the industry

Mahathir
Malaysia announced it would scrap the 6% GST rate, in line with the electoral promise by Prime Minister Mahathir Bin Mohamad that helped him win the elections last week | Photo: AP/PTI

Malaysia deciding to scrap the goods and services tax (GST) on Wednesday, three years after its roll-out, may prompt India to tread with caution over the next few years to stabilise the new indirect tax regime implemented in July last year. Although the development in Malaysia may not have any direct impact on India, experts suggest the government should closely study the Malaysian experience, take ‘necessary precautions’, and come up with additional reforms to expand GST in a phased manner. “Events unfolding in Malaysia are unprecedented and quite ...