KUALA LUMPUR: The total collection from the Sales and Service Tax (SST) is expected to increase by RM5 billion in 2025 and RM10 billion in 2026 following its review and scope expansion, according to Finance Ministry secretary general of Treasury Datuk Johan Mahmood Merican.

Speaking during a fireside chat titled 'Social Safety Nets: Securing the Future' at the Sasana Symposium 2025 organised by Bank Negara Malaysia (BNM), he said the move to broaden the scope of SST is part of efforts to strengthen the country's fiscal position and ensure social and development spending remains sustainable in the long run.

"This is part of the Madani government's strategy to expand Malaysia's tax base, which is currently low at 12.5 per cent of the gross domestic product (GDP), one of the lowest in the region.

"Government spending demands increase every year, from cash assistance, healthcare, and education to the maintenance of basic infrastructure.

"We must strengthen our revenue without placing undue burden on the people," he said.

Commenting on the debate surrounding taxation of imported goods such as fruits, Johan said the government continues to weigh the needs of the people based on actual spending patterns while also needing to make long-term fiscal policy considerations.

"Our key principle is that national revenue must be increased progressively while minimising the impact on the average citizen.

"At the same time, the government maintains targeted subsidies, such as for electricity and diesel. Most households still enjoy subsidised rates, while large users and big companies are charged rates closer to market levels," he said.