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News Summary: Malaysia plans 6 percent sales tax

The Associated Press

Malaysian Prime Minister and Finance Minister Najib Razak, center, leaves the Finance Ministry for Parliament House to unveil the Malaysia's 2014 budget, in Putrajaya, Malaysia, Friday, Oct. 25, 2013. (AP Photo/Lai Seng Sin)

THE TAXMAN: Malaysian Prime Minister Najib Razak plans to impose a 6 percent goods and services tax by 2015 to boost revenue and stem rising government debt. Fuel and other subsidies will be slashed. Personal and corporate tax will be lowered.

THE PROBLEM: Standard and Poor's has warned of a credit ratings downgrade for Malaysia if it fails to improve its public finances.

THE OUTLOOK: Najib said the economy is expected to grow 5 to 5.5 percent next year, up from 4.5 to 5 percent in 2013. With rising revenue, he said the fiscal deficit is expected to narrow to 3.5 percent of GDP in 2014 from 4 percent this year.