PETALING JAYA: Pakatan Rakyat (PR) would propose that parliament set a minimum wage for private sector employees if the Goods and Services Tax (GST) is implemented to prevent the economically vulnerable segment of society from falling below a certain poverty level.

Klang MP Charles Santiago said the first reading of the GST bill in Dewan Rakyat on Dec 16, 2009 did not tackle the minimum wage issue and the opposition coalition would raise it at the upcoming sitting.

"There will be an impact on consumers with a certain increase in prices due to the shift from the Sales and Service Tax (SST) to GST," he said on Thursday, March 11, following a Selangor state-sponsored round table on "Is GST Neutral?".

He said the lower income group did not survive on zero-rated and tax-exempt supplies of basic goods like rice, sugar, flour, cooking oil, fish, meat and chicken alone.

Klang Municipal Council member Robert Choo Teck Keong added that the government would have to make sure an average person would not be unduly burdened by the GST.

"By giving the people a minimum wage, that would at least help cushion their expenses," he said.

Another panellist, Malaysian Trades Union Congress president Syed Shahir Syed Mohamud said his concern was centred on how the tax revenue from the GST would translate into benefits for the lower income group.

As long as the policy was not clear and made known to the public, he would remain sceptical towards it, Syed Shahir said.

Santiago said another core issue to focus on was how would GST serve as an "equitable" tax in an "unbalanced" environment.

"Will the RM1 billion extra revenue (projected value) from GST to the government be able to compensate the amount lost due to the lowering of corporate and income tax?" he said.

"Burden would be shifted from the rich to the poor if GST is mismanaged," he added.