Indirect Tax Policy Acceptance Model: From the Perspective of the Public in Malaysia

(Pages 66-75)

Nur Erma Suryani Mohd Jamel1, Nadiah Abd Hamid2,*, Siti Noor Hayati Mohd Zawawi3 and Soliha Sanusi4
1,2,3Faculty of Accountancy, Universiti Teknologi MARA, Cawangan Selangor, Kampus Puncak Alam, Selangor, Malaysia.
4Faculty of Economics and Management, Universiti Kebangsaan Malaysia.


Given the strong rumour that the Goods and Services Tax (GST) may be re-introduced in Malaysia, Bernama (2022) reported that Malaysia is keen on reintroducing GST to expand its revenue base and carry the weight of public subsidies. Due to GST abolishment, Malaysia incurred an annual revenue loss of RM20 billion, shockingly, the reintroduction of SST contributed little to the government. Unfortunately, from the public’s perspective, GST remains a very unpopular indirect tax reform due to its regressive nature, affecting both the poor and rich. Since the tax applies to every transaction regardless of the socioeconomic status of individuals, it places an undue burden, especially on poor households. The literature on the critical catalyst of the public acceptance of Malaysian indirect tax also lacks discussions on a specific public acceptance model for indirect tax policy implementation. This study, therefore, aims to bridge the gap by proposing an indirect tax acceptance model using the guiding principles of sound tax policy recommended by AICPA (2017). Using a quantitative approach, questionnaires were distributed to the B40, M40, and T20 household income earners throughout Malaysia. The results show that the guiding principles of the effectiveness of tax administrations, transparency and visibility, appropriate government revenue, neutrality, and simplicity are the variables that allow the assessment of public behaviour towards indirect tax. The findings can provide helpful feedback to relevant policymakers and tax authorities in designing a more acceptable indirect tax.


GST; SST; acceptance; burden; guiding principles of sound tax policy

How to Cite:

Nur Erma Suryani Mohd Jamel, Nadiah Abd Hamid, Siti Noor Hayati Mohd Zawawi and Soliha Sanusi. Indirect Tax Policy Acceptance Model: From the Perspective of the Public in Malaysia. [ref]: vol.21.2023. available at:

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