Malaysia should Have robust Tax system – Nor Yakob

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PETALING JAYA: Malaysia does not have a robust tax system that will bring more tax-based funding to pay for public healthcare, says Khazanah Research Institute chairman Nor Mohamed Yakcop.

The former finance minister said that the country’s gross domestic product keeps increasing but not its taxes.

“We have to look into changes in our taxation and increase taxes so that revenue can be used to ensure good health for our future generations,” he told a webinar organised by KRI today.

He also said Malaysians tended to spend more on treatment and not on prevention, such as screening for diseases and promoting healthy lifestyles via health education.

Tax-based financing provides public healthcare with the largest pool of funding possible to benefit the people, said KRI researcher Nazihah Muhamad Noor.

“A tax-based scheme mobilises funds from the entire population without an additional administrative burden, and increases resource availability,” she said.

Referring to a research paper co-written with fellow researcher Ilyana Syafiqa Mukhriz Mudaris, Nazihah said social health insurance may not be suitable for Malaysia as it adds a payroll tax for the people.

“Private health insurance is risk-rated, typically making it unaffordable for lower-income groups.”

Through the highly-subsidised public healthcare sector, Malaysia has been able to provide universal health coverage, producing significant improvements in health outcomes such as higher life expectancies, and low child and maternal mortality rates, the paper added.

To ensure continued health protection for the people, their research proposed three policy considerations for Malaysia’s healthcare system.

“First, to continue commitment to public healthcare that ensures the largest possible financial pooling mechanism that focuses on the entire population rather than groups of contributing individuals,” said Nazihah.

Secondly, to focus on comprehensive national electronic health records to facilitate person-centered continuity of care and promote preventive care services.

Their third proposal is a “health in all policies” approach to address social determinants of health, taking into consideration the health impact of all social policies.

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