Muhyiddin Slams Madani Govt, Urges Cancellation of SST Expansion and TNB Tariff Hike

Tan Sri Muhyiddin Yassin, Chairman of Perikatan Nasional (PN), has urged the Malaysian government to cancel the proposed expansion of the Sales and Service Tax (SST) scope and the planned electricity tariff hike, arguing that these measures impose new burdens on the public. He criticized the drastic SST expansion, which now taxes over 90% of goods, including basic necessities like sugar, salt, fish, vegetables, and fruits, affecting ordinary citizens.

Muhyiddin accused the Madani government of deviating from its promise to tax only the ultra-wealthy and redistributing wealth to the poor, labeling their actions as deceptive. He questioned the lack of parliamentary debate and public engagement on the SST expansion, which aims to raise an additional RM10 billion, and raised concerns about the cumulative impact of recent economic policies, including diesel subsidy cuts, SST rate hikes, and potential RON95 subsidy adjustments.

These, he argued, disproportionately burden the B40 and M40 income groups, comprising 85% of the population. Muhyiddin also highlighted Tenaga Nasional Berhad’s (TNB) RM1.04 billion profit in Q1 2025, questioning the need for an electricity tariff hike. He suggested reconsidering the Goods and Services Tax (GST) with a reasonable rate after stakeholder consultations, asserting that the current SST is more burdensome than GST. He concluded that the government’s failure to manage the economy prudently and alleviate public burdens reflects incompetence, urging its rejection by the people.

Muhyiddin’s Suggestions (Point-by-Point)

1. Cancel the SST Scope Expansion:
   • Muhyiddin called for the immediate cancellation of the proposed expansion of the SST, which now includes over 90% of goods, taxing 6,281 additional items (leaving only 1,813 exempt) such as basic necessities like apples, bananas, oranges, sugar, salt, fish, and vegetables.
   • Reason: This expansion burdens ordinary citizens, particularly the B40 and M40 groups, by increasing the cost of living, contrary to the government’s claim of targeting only the wealthy.
2. Cancel the Proposed Electricity Tariff Hike:
   • He urged the government to abandon plans to increase electricity tariffs.
   • Reason: Tenaga Nasional Berhad (TNB) reported a 53.5% profit increase to RM1.04 billion in Q1 2025, suggesting no financial justification for the hike, which would further strain households.
3. Find Alternative Fiscal Solutions:
   • Muhyiddin suggested that the government explore other methods to address the country’s fiscal challenges without imposing additional taxes or subsidy cuts on the public.
   • Reason: Continuous tax expansions and subsidy removals act like a “leech” draining the public, reflecting poor economic management and a lack of prudent governance.
4. Reconsider the Goods and Services Tax (GST):
   • He proposed re-evaluating the implementation of GST at a reasonable rate, following thorough stakeholder engagement.
   • Reason: The current SST framework is more burdensome to both the public and the economy compared to the previous GST system. He emphasized the distinction between GST (Goods and Services Tax) and “General Services Tax,” sarcastically noting the Prime Minister’s apparent confusion.
5. Engage in Parliamentary Debate and Public Consultation:
   • Muhyiddin called for the government to delay the SST expansion until the 2026 Budget presentation, allowing parliamentary debate and public engagement to justify the policy and clarify the allocation of the projected RM10 billion in additional revenue.
   • Reason: The rushed implementation without consultation lacks transparency and accountability, undermining democratic processes.
6. Prioritize Alleviating Public Burdens:
   • He emphasized that the government’s primary duty is to reduce, not increase, the financial burdens on citizens.
   • Reason: The cumulative impact of recent policies—diesel subsidy cuts, SST rate hikes, potential RON95 subsidy adjustments, and the SST expansion—severely affects 85% of the population (B40 and M40), risking economic hardship and public discontent.

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