KUALA LUMPUR: Sarawak DAP has urged the federal government to cut the Goods and Services Tax, so that people will have more money to spend, instead of cutting the EPF rate and reducing workers’ retirement savings.
Chong Chien Jen, the state party chief, said GST should be cut by 3 percent instead of an employee’s EPF contribution.
The EPF cut would drastically reduce workers’ savings and would be most felt by 80 percent of the contributors, those in the middle and lower income group.
He pointed out that an EPF report in March had said that 69 percent of the 14 million EPF contributors would have less than RM50,000 EPF savings at retirement.
“Without any extra income, they will finish this savings within five years,” he said.
Chong, who is MP for Bandar Kuching, said the EPF board believed that contributors should have at least RM196,800 in their retirement savings, enough to meet expenses of RM800 a month for 20 years.
However, the poverty income level was RM830 per month and many contributors would still be living under the poverty level. Only 20 percent of contributors would have savings at that level.
EPF contributions for employees were cut by 3 percent to 8 percent in the revised Budge presented on Thursday. However, contributors may opt to continue with the previous level of 11 percent.
Source from FMT NEWS