KUALA LUMPUR: The Royal Malaysian Customs Department (RMCD) has clarified that it was still in the midst of auditing the Goods and Services Tax (GST) refund claims amounting to RM19.47 million when the 2018 Auditor-General’s Report was being prepared.
The department said the status of the GST refund arrears from April 2015 to June 5, 2018 had caused confusion among those who referred to the report.
Even though the auditing was completed at the end of July, the GST Trust Fund was insufficient to repay the money as only a certain percentage was remitted from the Consolidated Fund Account, the department said in a statement.
In accordance with Section 54(2) of the GST Act 2014, the GST collected needed to be deposited into the GST Trust Fund before being credited into the Consolidated Fund Account upon the Finance Minister’s approval. However, RMCD said the entire GST fund was credited into the Consolidated Fund Account without the minister’s approval.
“The GST Trust Fund still requires a transfer of RM19.2 billion to pay the GST refunds which have been or have yet to be approved.
“The Consolidated Fund Account only has RM450 million as at April 30, 2018. As such, the government needs to rely on the special dividend from Petronas to pay the GST refunds,” it said.
The department also clarified that the payment of arrears amounting to RM900 million to two government-owned companies arose from an exemption given by the Ministry of Finance under Section 56(3) of the GST Act 2014 for the input tax which had been paid by them.
“There was no loss of funds as both companies are 100 per cent owned by the federal government,” it added. –Bernama
