Where is your proof Pakatan spent RM18b GST refunds? Guan Eng asks Najib

Azril Annuar
Lim gave his assurance that his ministry will cooperate with authorities investigating the matter. — Picture by Miera Zulyana

KUALA LUMPUR, Aug 11 — Datuk Seri Najib Razak must furnish evidence to back his claim that Pakatan Harapan (PH) used up the RM18 billion in Goods and Services Tax (GST) refunds, Lim Guan Eng said today.

In a press statement, Lim said Najib’s accusation that the PH government, which came to power in May, had siphoned off the money that was supposed to be in a trust account was “bereft of reason and truth”.

“Former prime minister Najib Abdul Razak has claimed in a blog post that the Pakatan Harapan government could have spent the RM18 billion in Goods and Services Tax (GST) refunds that Finance Minister Lim Guan Eng is now accusing the previous administration of robbing.

“This is a shocking accusation by Najib bereft of reason and truth. The PH government is now accused of a wrongdoing and delay in making GST refunds committed by the previous government,” he said.

He then reproduced an excerpt from his Parliamentary speech exposing the issue, quoting official Royal Customs Department documents which recorded that the RM19.4 billion owed to companies go back to as early as 2015, the year the unpopular tax was introduced.

Lim pointed out that the shortfall was not incurred within a month, but built up over three years from April 1, 2015.

“Can Najib prove his claim that the new Pakatan Harapan government was able to spend RM18 billion in only three weeks, when Najib failed to return GST refunds by three years, what the law required to be refunded in two weeks?

“Prime Minister Tun Dr Mahathir Mohamad was sworn in as the 7the prime minister of Malaysia on May 10, 2018 whilst I was only sworn in as finance minister on May 21, 2018.

“How could Tun Dr Mahathir as prime minister spend RM18 billion in three weeks or I as finance minister spend RM18 billion in 10 days as implicitly claimed by Najib?” he questioned.

Lim also quoted clauses in the GST Act itself, specifically on tax refunds and bolded the sub clause that grants Najib, as then finance minister, the sole authority to transfer the money out of the trust account and into a consolidated account.

Clause 54 (5) reads: Notwithstanding subsection (2) and the provisions of the Financial Procedure Act 1957, the Minister may authorise the payment into the Consolidated Revenue Account in the Federal Consolidated Fund of all or part of the moneys of the Fund.

He also questioned whether Najib gave the authority to former Treasury secretary-general Tan Sri Mohd Irwan Serigar Abdullah not to transfer the missing RM18 billion into the GST Refunds trust account.

The subject of Irwan’s credibility came into question, especially when the minister pointed out that Royal Customs Department Director-General Datuk Seri T. Subromaniam had publicly stated he had requested for the full amount since 2015 but it fell on deaf ears.

“Like his former boss (Najib), the former Treasury secretary-general has also not been completely truthful with the facts when he claimed that all GST payments are made into the Consolidated Revenue account, but did not explain why he refused to transfer RM18 billion into the GST refund trust account.

“Yesterday, The Royal Customs Department Director-General Datuk Seri Subromaniam Tholasy publicly stated that he had requested for a total of RM82.9 billion to be transferred to the GST Refund Trust account at the monthly Trust Fund committee meeting chaired by Irwan since 2015.

“This was not done by Irwan. Despite the Customs Department making requests during the monthly meetings chaired by Irwan, Subromaniam confirmed that RM19.4 billion had still not been transferred in full as at May 31, 2018,” Lim said.

Lim gave his assurance that his ministry will cooperate with authorities investigating the matter.