From the Field

Frederico Gil Sander

World Bank urges Malaysia to broaden tax base

KUALA LUMPUR, January 22, 2015 – If Malaysia wants to cushion the impact of decreasing oil revenue on the economy it will have to cut back on the number of goods either exempt from the goods and services tax or zero-rated. According to the World Bank’s senior economist on Malaysia, Frederico Gil Sander, now is the time for a thorough review of the list of goods and “ensure that only those essential goods are not taxed.” The move could also potentially facilitate progress on economic reform in the country, he wrote in an e-mail to Malay Mail Online.


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Gil Sander also encouraged the government to make the necessary policy arrangements for the day oil prices will bounce back, especially in light of the recently scrapped fuel subsidies. He said the government has an opportunity to work to “avoid pressure to reintroduce subsidies.”

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