Delays in payment of GST Refunds are posing challenges for
exporters
A key feature of Malaysia's economy is its export focused
manufacturing base, a sector that relies heavily on high volumes to
manage tight margins and cash flow constraints. The introduction of
the GST was intended to boost this industry as exports would not be
taxed and would remove the cost of indirect tax from the supply
chain.
However, the beneficial effects of the efficiency of the GST is
contingent on the ability of these exporters to receive this GST
back as quickly as possible so that it does not impact on their
cash flow to any significant extent. As exports are not taxed,
exporters are entitled to a GST Refund for GST incurred on their
local costs. This should be payable within 14 working days of the
GST Return being submitted electronically.
