Research 2023

The Institute of Strategic Analysis and Policy Research (INSAP) calls on the government to reintroduce the Goods and Service Tax (GST) in view of the complaints from businesses and consumers on the complexity of the existing tax system, the Sales and Service Tax (SST).

Instead of introducing various forms of taxes to increase government revenue, the government should implement a broader tax base with a single, transparent system like GST. This would streamline tax collection for the government and reduce the administrative burden for businesses struggling with the current complexities.

By reintroducing GST, the government would not only collect more revenue but also reduce the tax burden. Unlike the Sales and Service Tax (SST), which creates a “tax-on-tax” effect by taxing businesses on previously taxed inputs, GST ensures a fairer system where the final consumer bears the tax. This cascading effect under the current SST structure artificially inflates prices for everyone.

The introduction of Flexible Account 3 by the Employees Provident Fund (EPF) has been met with mixed reactions. Some people are concerned that it will allow for easier access to retirement savings, which could leave people with less money in the long run. The current government, painting itself as the champion of the people, argues that this new account empowers citizens with more control over their finances, potentially acting as a lifeline during hardships. However, critics see it as a reckless gamble, a raid on retirement funds that could leave Malaysians financially exposed in their later years. They fear this could destabilize the entire EPF system, jeopardizing the financial well-being of millions and potentially impacting the national economy.

Malaysians deserve a government that prioritizes Competency, Accountability, and Transparency (CAT). Recent developments surrounding the RM190 million1 contract awarded to Heitech Padu Bhd for the maintenance of the Road Transport Department’s (JPJ) MySikap website raise serious questions about the integrity of the process.
Recent news that Farhash Wafa Salvador Rizal Mubarak, a former associate of Prime Minister Anwar Ibrahim, divested his significant stake in Heitech Padu does not erase the concerns surrounding the timing of the contract award 2. This sudden investment fuels concerns of political connections appear to influence multi-million-ringgit deals. Was it a lucky coincidence? The awarding process and potential connections should be open and transparent. This ensures decisions are based solely on merit and serve the best interests of Malaysians.

The global semiconductor landscape is undergoing a significant shift, driven by intensifying geopolitical competition, particularly between the United States and China has made Malaysia is emerging as a key beneficiary of this conflict and attracting billions of dollars in investments from leading technology companies.

The 2024 Taiwan presidential elections have set the stage for significant shifts in Taiwan’s political and geopolitical trajectory. The country’s strategic outreach efforts, domestic political realignments, and evolving relationship with China are indicative of a broader regional trend towards re-evaluation of traditional political allegiances and the emergence of new political forces. As Taiwan continues to navigate these challenges, the implications for its domestic politics, foreign policy, and strategic positioning within the Asia-Pacific region remain of paramount importance.

The recent announcement of a 6% Sales and Services Tax (SST) on local logistics services has sent shockwaves through the Malaysian industry. This policy, shrouded in confusion and with potentially detrimental consequences, threatens to cripple Malaysia’s trade competitiveness in the region.

The Consumer Price Index, which is a key economic indicator that acts like a magnifying glass which allows us to deep dive into trends reflecting average change in cost of purchasing a specific basket of goods and service over a period of time. Why is this important in terms of our daily live consumption?

This is because when CPI goes up, it means that the cost of our items (think groceries, clothes, medical expenditure) is going up. This phenomenon in economic terms is known as inflation. In simple terms, this would feel like your paycheck shrinking even when your salary has not actually changed. In contrast if CPI goes down, this is like finding out you have a special discount card in your wallet as goods or services you often consume becomes cheaper.

So, the CPI is not just another economic statistic. This is a window, looking into our own purchasing power where it acts as a signal of how much one person’s hard-earned money can buy.

Soaring exports paint a picture of economic success, but a closer look reveals a hidden truth. While Optimists celebrate, a weakening Ringgit threatens to erode the gains, potentially leaving ordinary Malaysians worse off. Is this a story of short-term prosperity masking long-term trouble?

As Malaysia prepares for the joyous celebration of Chinese New Year, a shadow of rising costs threatens to dampen the festive spirit. From soaring food prices due to global disruptions and local factors, to increased transportation costs and anticipated tax and utility hikes, Malaysians face a squeeze on their wallets. These pressures, on top of existing burdens like high housing costs and healthcare expenses, force difficult choices between celebrating traditions and meeting essential needs. However, the cultural significance of the holiday as a driver of economic activity through consumer spending remains crucial. Recognizing the delicate balance, Malaysians are likely to adopt a more cautious approach, prioritizing essentials and seeking creative, cost-effective ways to celebrate, such as potluck gatherings and homemade meals. While economic anxieties are present, the spirit of resilience and resourcefulness promises to ensure that the true essence of togetherness and joy remains at the heart of Chinese New Year celebrations.

Malaysia is grappling with the potential impact of a major retirement crisis. Unfortunately, Malaysia is lacking initiatives that tackles the root issues of this crisis.

Malaysia stands at a crossroads: embrace systemic reforms now or face a future shadowed by widespread retirement poverty. What next?