GST Will Now be Imposed on Research Grants

With the issue regarding budget cuts having barely died down, now comes the news that academics are also getting less money for research as most grants now attract the Goods and Services Tax (GST).

According to the Customs Department, most research grants, no matter their origin, would be subject to the GST, but some would not be taxed, especially if the grant was between a ministry and a statutory body.  Customs Department deputy director general Datuk Zulkifli Yahya went on to explain to the Malay Mail Online that the GST is not imposed on the grant itself, but rather on the the supply derived from the grant. According to Zulkifli, the MOHE wrote a letter to all universities last August to inform them about this.

Having already had their combined operating budgets for this year cut by about 19 per cent, or RM1.5 billion, this would be another blow to public universities in the nation, with 10 of them already facing massive cuts ranging from over 10 per cent to over 31 per cent.

Local daily Berita Harian reported Monday the Malaysian Academic Association Congress saying that almost 6,000 lecturers, including professors, did not have their contracts renewed since last year due to financial constraints at public universities, which the MOHE rebuked, saying since 2012, the number was closer to the 2,000 mark

Many researchers have lamented the taxation of research grants amid greater difficulties in getting funds, citing the already high cost of conducting research in the current environment. What do you think of the whole matter?