Impact of SST on society and country. On 1 September last year Malaysia replaced the Goods and Services Tax(GST) with the Sales and Services Tax(SST). Both tax systems are indirect and are payable on some taxable goods and services. In line with the new Sales & Services Tax, sales tax is paid for particular product types and some services are charged for service tax. The implementation of SST causes a lot of impact on both society and the country. Society First of all, the enactment of SST causes a decrease in tax burden for the consumers. Overall, an estimated sum of RM 10 billlion to Rm15 biilion will be reduced as a tax burden for the consumers. This increase the disposable income of the consumers which causes their purchasing power to increase. The consumers only needed to pay tax a single time compare for goods and services. This will cause an increase in cash flow in the market and the demand for the household product and foods and beverages will be high as purchasing power of consumers increases. As the demand increases for the goods, the businesses will make a huge amount of revenue in fulfilling the demand. It also gives an opportunity to some new businesses to fill in the void if the market demand cannot be fulfilled. An increase in disposable income also causes an increase in private savings and private investments. This will allow the consumers to have fundings for emergency and other daily purposes. Depending on types of goods such as private goods, public goods and luxury goods the consumers buy, the price will affected will be different based on the income groups. Secondly, the enforcement of SST causes a few items to have tax exemption. The amount of exemptions covers food, chemicals, medicinal products, drugs, iron, stainless steel and equipment, is quite a lot under this current indirect taxation regime. This ensures less firms must comply with SST to be registered. Tailoring, gemmaking, optician facilities and gravings are also excluded from SST. This causes the prices of the said goods and services to drop which causes the goods and services to be cheaper. This will push the consumers to buy more goods and services as they have more purchasing power for same type goods. Thirdly, a lot of consumers expects that prices of houses will reduce after the enforcement of SST. This is because SST is excluded from fundamental construction materials, such as cement, bricks and some steel goods. But Building Materials Distributors Association of Malaysia (BMDAM) President Bill Lee said that cost fluctuations are influenced by various variables, including overheads, currency exchange, demand, supply and margin of profit. This factors may cause the cost of a property may not change eventhough the building materials are excluded from SST. It also may cause a higher tax pressure on employers, developers and engineers' technical services to the property buyers. Country The implementation of SST also gives some huge impact to the country. Based on Nikkei’s September 2019 Purchasing Manufacturer’s Index (PMI), the manufacturing condition in Malaysia has been booming for the past 10 months. It causes a tremendous increase in creation of job which causes the unemployment rate to reduce. The World Bank expects a slow growth in economy in year 2018 to year 2020 and expects the fiscal deficit to narrow. Besides that, SST places big burden on businesses. SST became a business cost and its is only deducted when there is a sale. Simply, if there is no sale, the company cannot claim the cost of SST. Sales tax is a portion of inventory cost and it is only deductable when the inventories are sold. This causes the cost for businesses to increase. To reduce the cost, the businesses may reduce the volume of the products to reduce their loss. This will cause the supply for the products that are not exempted of SST to reduce eventhough there is a high demand for it in the market. The transition from GST to SST causes a reduction in tax revenue for budget year 2019. Thus, the state would not receive as much transaction income as the GST tax the old government receives from the SST. The Ministry of Finance expects to suffer deficits and in collection profits. In order to address this, efforts such as LRT 3 have been delayed that do not have strong demand. From this we can say that the reduction in tax revenue causes some postponement in the development of the country for certain period.