The Forecast by Minister in the Prime Minister's parallel with several financial studies indicate the current rate of inflation at 2 per cent of Malaysia would increase the price of fuel is more expensive.
Putrajaya said, cutting subsidies through higher oil prices by 20 cents to be RM2.10 per liter RON95 petrol and diesel to RM2 per liter could save the government as much as RM3.3 billion a year . RON97 petrol quality based on market prices.
Abdul Wahid also try to reduce the fear that even the implementation of the goods and services tax (GST ) will raise the cost of goods, but it will have tax exemption.
"Usually, when countries implement the GST , there will always be items that are exempted from tax, so use zero rate goods," he said in Kuala Lumpur today.
Talk about the government's plan to introduce GST causing concerns about price increases, and increased their fear of rising oil prices after the announcement yesterday.
The minister, however mengulaingi that GST is 'to replace the sales and services tax' which existing and the government 'would ensure that the impact on the people can run'.
GST would come into force in 2015, if it is included in the national budget to be announced in October.
According to the Finance Ministry Secretary-General Tan Sri Dr Mohd Irwan Abdullah Serigar last week, he was quoted as saying that the use of tax 'must, not an option'.
Putrajaya estimates that four percent GST may contribute RM1 billion per year in revenue and can reduce dependence on oil company Petronas.
Abdul Wahid said the immediate focus of the government is to reduce the fiscal deficit, the overall forest management and addressing the current account surplus.
The national budget deficit, the amount the government spent more than the amount available, which is 4.5 percent of gross domestic product ( GDP ) last year. Meanwhile, the debt to GDP stood at 53.1 percent, almost reaching the ceiling set at 55 per cent of government.
Malaysia's current account surplus fell to RM2.6 billion from RM8.7 there second quarter billion earlier this year when exports fell after news of the U.S. Federal Reserve will reduce the dollar.
Najib administration's Government criticized for wasteful spending before the general election on May 13 to give money to help people despite the global financial crisis. Government made aware of the financial realities of the country when Fitch Ratings, one of the firms international rates, lower credit rating to negative Malaysia last month that severe financial management.
Last year, Malaysia has become one of the fastest growing markets and create a concern after listing several accomplishments through public issue of shares (IPO) is great. It also came in sixth place out of 20 potential markets for growth as listed Bloomberg in January this year.
"Just look at our current situation. Global economic environment changed completely from last year to this year's situation," said Abdul Wahid.
"Last year, a lot of optimism with quantitative mitigation (QE) continues but this year with the announcement of QE measurement reversal, we are looking at the flow of the market to grow back to emerging markets."
While the government is struggling to introduce an immediate remedy to boost investor confidence and improve the economy, he tried to convince people that even if the subsidy is maintained, there will be no comprehensive policy.
"Instead of giving subsidy to the entire population, it is better to make it more of a target subsidies granted to those who served and more need," he said. - 3 September, 2013.
Inflation rate in Malaysia
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