Photo - Chin Jun Fwu, Research Manager, IDC Malaysia
Following a recent reaffirmation by Malaysia's prime minister that the new GST [Goods and Services Tax] will be implemented on 1 April 2015, analyst firm IDC is predicting a last-minute scramble by businesses to be GST-compliant.
Local media reported that the Malaysian prime minister Dato' Sri Najib Tun Razak also called on the professional accountancy industry to support a smooth implementation of GST during his keynote at the recent Malaysia Institute of Accountants (MIA) International Accountants Conference. He expected the number of GST-registered companies to increase from the current 120,00 to 200,000 by the end of this year.
In a separate announcement, IDC Malaysia research manager Chin Jun Fwu said that GST would be a catalyst of growth for the Malaysian enterprise applications industry.
"The requirements for GST implementation are standard but not every organisation is structured the same. Issues of compliance can be made even more complicated depending on configuration of not only systems, but also existing procedure," said Chin.
"It should be kept in mind that GST is not a departmental issue, but an organisation-wide exercise. The entire issue of compliance cannot simply be left to the accountants, auditors, and IT staff and must be treated as a whole," he said.
Chin said that how well companies navigate through is may be the difference between success and failure. 'The alternative will be to face the consequences in terms of fines for late GST registration and stiff penalties for non-GST registration', according to a recent Maybank Research report.
Early preparation of GST systems
In view of the potential impact to businesses, SAP Malaysia has put in place a dedicated GST Task Force, said business applications provider SAP Malaysia's managing director, Bernard Chiang (pic below).
Chiang said the company was already working closely with the Royal Malaysian Customs Department, which has as early as the beginning of 2014 prepared its online system for GST tax submission and the issuing of GST refunds.
"In order to interface correctly with the system, Malaysian companies must put in place correct GST records and processes," he said. "SAP Malaysia is confident it can help businesses achieve four key objectives for GST implementation:
o Provide relevant solutions to support the Malaysian taxation reform;
o Include any necessary GST enhancements in 'standard' SAP;
o Improve education of project teams and trainers; and
o Recommend solutions for all supported releases."
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