KUALA LUMPUR - Former Malaysian finance minister Daim Zainuddin has criticised the government's decision to waive the goods and services tax (GST) for a big China company which is building a controversial RM55 billion (S$18.6 billion) East Coast Rail Link (ECRL).
Tun Daim's public comments made him the third former veteran ex-minister who had sounded out in recent weeks against the administration of Prime Minister Najib Razak, amid a tough general election campaign.
Mr Daim, 79, also criticised the reason given by Malaysian officials to justify the waiver to pay the 6 per cent GST which critics have said would save the company, China Communications Construction Company (CCCC), RM3 billion.
"The people are asking, 'Why am I paying GST? I am paying, but the government does not seem to care'," Mr Daim was quoted as saying by Free Malaysia Today (FMT) news site after attending a forum in Langkawi on Sunday (April 22).
"The government just says, 'Oh, you must pay'. But these people are business people. They will make money anyway. But you still waive the GST for them," Daim told reporters.
The ECRL project has been controversial from the start, with critics pointing to its alleged high cost and the lack of a project tender.
The 600km rail line will join Port Klang and Kuala Lumpur in the west coast of Peninsular Malaysia, to Kuantan port in the east coast, and to the state capitals of Terengganu and Kelantan. But critics say there won't be enough cargo or human traffic to justify the megaproject, which will eventually be paid for by public funds.
Last week, an opposition leader showed documents that he said showed CCCC won't be paying the 6 per cent GST. The GST is a huge election issue as it is being blamed for rising costs of everything.
Director-general of Malaysian Royal Customs Department Subromaniam Tholasy said the waiver was nothing new, and said similar exemptions were also given to state projects during the administration of Tun Mahathir Mohamad who is now an opposition leader.
The Finance Ministry's secretary-general Mohd Irwan Serigar Abdullah said the waiver would keep down construction costs so that it won't go beyond RM55 billion.
But Mr Daim said this explanation cannot stand, according to the FMT report.
"What is the reason? To reduce cost. Then people will ask, what about my cost? I am also suffering," said the former Umno treasurer who was finance minister under Dr Mahathir.
Mr Daim said the government was also suggesting that the ECRL costs were higher.
"They are telling the people, it is really more than RM55 billion. But we absorb the GST," he said.
Two other former Cabinet ministers asked uncomfortable questions of the Najib administration in recent weeks.
Former international trade minister Rafidah Aziz had alleged earlier this month that in a Cabinet meeting in late 2007, then-defence minister Najib Razak had issued a paper to privatise all land that belongs to the Ministry of Defence to three individuals, and that the proposal was accepted by then-prime minister Tun Abdullah Badawi.
Mindef denied the allegations that huge parcels of its land had been misappropriated, adding its "land swop" projects were carried out with several companies under government procedures.
Last week, former culture minister Rais Yatim said Umno should ask the court, and not the Registrar of Societies whether it could postpone its internal elections beyond its Constitutional limit of three years.
He reminded Umno members that the party was deregistered in 1988 during a leadership battle after some members asked the High Court to decide on an Umno constitutional matter regarding illegal party branches.
