KUALA LUMPUR, Nov 23 – The Goods and Services Tax (GST), to be implemented on April 1 next year, can lead to companies growing their businesses further. Global accounting body CPA Australia’s head of policy and external positioning Paul Drum said once GST was implemented, firms would become more efficient in filing taxes.
He said they could track their inventories better and effectively manage cash flows. “By keeping a good tax record, companies can get their credits back from the government. “From the Australian experience, which implemented GST in July 2000, businesses grew due to better record keeping, better output and input controls and better knowledge of the tax system,” Drum told Business Times recently.
He said between now and April, Malaysiancompanies should continue to prepare for GST, which includes undertaking training and seeking advice on how GST will impact businesses. They can also review the effects of the removal of the sales and service tax and the impact of GST on prices of goods. Drum said companies should upgrade their systems to comply with the GST law.
Businesses should also take a strategic approach in reviewing costs, undertake a competitor analysis to identify opportunities and risks, and focus on staff productivity and training. Meanwhile, in the annual CPA Australia Asia Pacific Small Business Survey released last week, Drum said a majority of Malaysian businesses had undertaken some activity to prepare for GST.
The larger the businesses, the more likely they have taken some action to prepare for the new tax implementation. Businesses that were established less than five years are more likely not to have taken any action yet to prepare for the GST, according to the survey.