1. Governments need money. It cannot function without money. It has to pay the people who work for it. It has to provide services and infrastructures. And now it has to provide more and more social amenities such as education, medical care etc. And of course it must defend the country and maintain law and order.
2. The funds are mostly raised through taxes on the activities of the people, on incomes, on profits, on the services provided by the government such as transportations, sewerage, water and power, ports and airports, approval processes and oversights etc.
3. Although there are many countries where people avoid paying taxes and rates, the people of Malaysia generally pay their taxes and other charges for services rendered by the Government. But as the cost of Government increase over time, the taxes and rates will need to be increased. Naturally tax and rate-payers do not like to pay more taxes and other charges. But they admit to a need for higher tax rates if for nothing else the rise in the cost of living when the wages and salaries of government servants need to be raised as well as the higher cost of Government procurements.
4. But the tax payers cannot suddenly come up with the money to pay the new taxes and charges. Lately Malaysian individuals and businesses have to come up with more money because of the many increases in cost due to Government policy decisions. Firstly the increase in minimum wage to RM900/-. This increase cannot be limited to those earning less than RM900/-. Those already earning RM900/- and above will also need to be paid higher wages. With this the costs of doing business and producing goods and services have increased and in turn the cost of living for everyone has increased.
5. Over and above this the Government decided to reduce subsidies on petroleum products. Then the electricity charges are going to be raised. For the people of Kuala Lumpur new rates, some increasing by 2000 % are to be charged.
6. In 2015 the GST (Goods and Services Tax) will replace the sales tax. Obviously the Government wants to collect more than the revenue from sales tax, and this must add to the cost of goods and services.
7. We must accept that the Government needs more money with the passage of time. But should the increase be as big as the Government says. Should the taxes and rates come all at the same time?
8. In business there is a thing called “cost down”. When a business is faced with competition or its cost of production reduces its profits, it can either increase prices or reduce cost. To a certain extent the price can be increased. This might cause a reduction in sale and also profits. It is far better to reduce cost and maintain or minimise the increase in price.
9. When a business exercises cost down, what it does is to examine everything that it does which contributes to the cost of doing business. It examines the efficiency of the process, the material cost, the reduction of wastage, the speed and volume of production. Invariably some cost can be reduced.
10. The same can be done by Government. All its cost can be examined to determine which are truly necessary, which cost can be reduced, which service can be curtailed or modified etc. etc.