How Ge Teaches Teams To Lead Change Management Essay

How Ge Teaches Teams To Lead Change Management Essay The purpose of the program was to support CEO Jeffery R. Immelts priority of growing GE by focusing more on expanding businesses and creating new ones than on making acquisitions. This program was effective for the company for many reasons and brought many advantages to it. For example, the business has accelerated its push into emerging markets, launched initiatives to revamp product development, and stepped up efforts to create new businesses. The reasons for why this program was so effective were because: the managers were given an opportunity to reach consensus on the barriers to change; both the hard and the soft ones. Furthermore, the challenge of balancing the short term and the long term was also addressed. The course also created a common vocabulary of change that became part of daily communications inside and across GEs businesses. This program was structured so that a team would emerge with the first draft of an action plan for instituting change in its business and would feel obligated to deliver on it. In September 2001, Jeff Immelt had launched an all-out effort to make GE as renowned for innovation and organic growth as it was for operational excellence. The main force behind GEs successes was its headquarters. Immelt understood that to speed progress, he needed to pass the baton to teams leading GEs businesses-which is where LIG came in. They reorganized functions such as sales and engineering and gave local teams more authority so that the leadership could extract itself from the problems of the present and spend more time on opportunities that would create the future. The purpose of LIG was to make innovation and growth as much of a religion at GE as Six Sigma had been under Jack Welch. Before a team went to Crotonville, it had done three things: It had updated its three-year strategy, the growth playbook. All its members had undergone a 360 review, and the teams scores on the growth values had been tabulated and analyzed in granular detail. Finally, its success in creating an innovative climate had been assessed. At the end of the course each team had about 20 minutes to deliver a presentation to Immelt. The presentation had to include a simplified vision of growth for the business and the organizational, cultural, and capability changes that the team members had decided should be made in order to optimize growth. LIGs team-based approach addresses shortcomings inherent in the individual-focused approach used by traditional management education programs. The LIG was a radical departure for GE, because it removed intact leadership teams from the exigencies of their business and allowed them to discuss the white space in a candid, introspective fashion for four whole days. In order to achieve the business goals in the organization, leaders should know in advance which things to do and how to do them. For example, taking a place in new markets or an expansion into different markets. After that they should decide which leadership style they want to use in order to fit in the new markets, all this by designing effective plans to manage themselves, subordinates and organization. Introduction/Paper discussion Titles and positions have always been important in our life and especially within organizational environment. People tend to get blinded by the titles that they have, and this influences the peoples behavior. The topic that we have chosen to analyze is about the type of power that leaders possess and how this could influence the effectiveness of being a leader. We have also chosen to talk about how powerful leaders with and without formal titles are. This is also because titles have always been present in our lives and they influence the image that we have of a person. We wanted to relate this to leaders. Theories have always discussed the importance of leadership and formal power, while based on our own experience, there are less researches done about informal power and its influence on leadership. Most people take formal positions and titles for granted. They always associate the amount of power a certain person has with the titles that they possess. We decided to take a deeper look at the influence of leaders with informal power on their workers and how this is different from the influence of leaders with formal positions. The main question of this analysis is: How would leaders with informal power influence their workers? The purpose of this study is to find out how leaders with informal positions motivate their workers to follow them and what the differences are between leaders with formal and informal power. Theoretical Perspectives We will start this analysis by looking at different article to get an insight on earlier discussions and researches about the topic. We will also research other articles that will support the case and help us answer the main question. In order to support our case, first we wanted to know the difference between formal and informal leaders. This is important because informal leaders dont have any formal authorized positions. This part will give us an insight on how informal leaders would influence others. The traits and skills of the informal leaders will also be mentioned here. After that, the difference between formal and informal power will be discussed. The reason of why we have chosen to discuss this is because it will give us an understanding of power and the link between power and leadership. Titles and leaders will also be discusses so that we would get clear insight about the link between titles and leaders. Furthermore, the influence of titles will also be mentioned in order to see how titles influence leaders and then eventually their ability to influence followers. After doing this analysis based on the earlier discussions and different arguments from varied studies and articles, we will use the book of Leadership in Organizations, written by Gray Yukl. The topic will be analyzed based on the concepts in this book. Theoretical Discussion Formal and Informal Leaders We will start our analysis by talking about formal and informal leaders and the differences between them. The article that is used here is a study done by the Ohio State University. Informal leaders are related to people who dont have any formal titles in the organization. They are seen as worthy of paying attention to, or following. People think that informal leaders have a certain trait that make the others in the organization pay attention to them and also follow them. While formal leaders hold a certain position and a formal authority in the organization, informal leaders dont. People choose to follow informal leaders because they want to, but with formal leaders they are obligated to follow them otherwise they would have to face the consequences of not complying. Informal leaders are able to make others follow them through their ability to gain followers respect, trust and confidence. The personal traits and skills that informal leaders have, can replace the formal power or position that they dont have. Informal leaders appear to treat everyone with dignity and respect. They exhibit honesty and dignity and emphasise service above self and they are more likely to build trust. Formal and Informal Power In order to get an understanding of power and the link between power and leadership we chose to analyze the formal and informal power. The article from University of Valencia, Spain is used to support our analysis. Formal power is based on the availability or capability to control the exchange of socially valued restricted goods whose distribution is related to the position in the organisation of hierarchy. Formal power is exercised in a top-down manner. The superiors exert formal power on the subordinates while the opposite is not the case. Therefore, it can be expected that a power agent holding a higher hierarchical position than that of the target will hold more formal power over the target than peers or subordinates. Informal power is based on positive interpersonal relations, involving the exchange of social support, referent relationships, or knowledge, or socially valued unrestricted goods. Informal power, not being necessarily associated with formal structure, can flow in all directions. However, positions in the hierarchies affect the development of personal relationships. Dyadic cohesion develops through an emotional/affective process characteristic of equal-power relations that can be obstructed by the unequal relationships that characterize formal power relationships. Taking this into account, it can be expected that members in a similar hierarchical position to the target will hold higher informal power over the target person than superiors and subordinates. Based on what is mentioned above, we can say that formal and informal power is really important in organisational life. They have influence on how leaders exercise their power. For example, leaders with formal positions exercise their power in a top-down manner, while those with informal power can influence others who are on the same level without any formal position. There is no formal structure but the relation between the individuals in the organization could go to any direction. Looking at this topic from a different perspective, power can be grouped in two categories, the social condition and the personal ability. These categories aim to distinguish positional power and personal power. Position power steams from a persons formal position and implies the legitimate authority to use positive and negative sanctions such as reward and coercion; while on the other hand personal power refers to expertise, referent power and charisma of a person. Summarising this, position power mostly refers to the existing organisational hierarchy that renders management the ability to control the behaviour of others and to change the organisational structure and processes. On the other hand, personal power refers to power sources connected to particular abilities, skills and experience of an actor. As we can see, position power could be related to the formal power that people have. It is the authorised and legitimate power that they possess. They have the title and formal posit ion to exercise their formal power to make others in the organisation follow them. Personal power can be related to the informal power, this is where people dont have authorised power, position or title to make people follow them, but they do it through their personal trait and skills. We can use volunteer work as an example of the distinction between leaders with formal and informal power. When we think about non-profit organizations we think about organizations where people dont have any formal power or positions. The idea of such organizations is to let people work without using any formal authority and to achieve the organizational goals. These people don ´t have a formal title and their followers are not obligated to follow them. This makes it challenging to these organizations to survive and serve their main goals. Nowadays, almost all kind of organizations rapidly adapt the formal business culture to face the challenges and survive in the marketplace. The workers in these organizations get formal positions to make sure that the work gets done properly. A good example of a leader who combined the formal and informal power in his leadership is Nelson Mandela. He conveyed his beliefs about racism and discrimination to the world and he was the formal leader of anti-discrimination organizations. While when Nelson Mandela was in prison, he didnt have any formal power but he still influenced a lot of people in the world. Position and Personal Power Power is usually used to describe the absolute capacity of the individual agent to influence the behaviour or attitudes of one or more designated target persons at a given point in time. Power is divided into two major groups; position power and personal power (Bass, 1960; Etzioni, 1961). Position power includes potential influence derived from legitimate authority, control over resources and rewards, control over punishments, control over information, and control over the physical work environment. Personal power includes potential influence derived from task expertise, and potential influence based on friendship and loyalty. Based on this study, the position power is more related to formal leaders because the people in organizations who have legitimate power give direct orders and requests in organizations. They have the authority to reward the followers, punish them if they dont comply with the orders, they have the control over information which is available and they also have control over the situation. While on the other side, leaders with informal positions have more of the personal power. Informal leaders exercise referent power through role modelling, because a person who is well liked and admired can have considerable influence over others by setting example of proper and desired behaviour for them to imitate. When identification is strong, imitation is likely to accrue even without any conscious intention by the agent. Informal leaders are charismatic and they are very much admired by the others, this is why others follow them even without having any legitimate power. Informal leaders are also known for being friendly, attractive, charming and trustworthy, they also show concern for the needs and feelings of the others, demonstrating trust and respect, and treating people fairly. Referent power depends greatly on these characteristics and personal traits and therefore any person in the organization who possesses these kind of skills can influence the other workers without doing any effort. Position power is important, not only as a source of influence but also because it can be used to enhance a leaders personal power. Besides that, most of power studies have found that effective leaders rely more on expert and referent power to influence subordinates, this is because they are positively correlated with subordinate satisfaction and performance. On the other hand, the same study has also found that legitimate power is an important reason for behavioural compliance. (Hinkin Schriesheim, 1989; Rahim, 1989; Schriesheim, Hinkin Podsakoff, 1991). So in the end, both position and personal power are essential for a leader to be effective in the workplace. Titles and Leaders The article Titles dont make leaders from the Harvard Business school is used here to support out hypothesis. Stever Robbins argues that leadership often ignores the fact that leadership is powerful at any and all levels-and that you do not need to be heading up an organization to be an effective leader. He believes that it doesnt matter what title or position you have, in order to do your job effectively. Some of the most effective business people could influence others without having any superior role or title. He also argues that a leaders job is to insure the success of the organization no matter who reports to whom in any given group. This means that anyone in the group can be the leader as long as he/she is willing to achieve the goals of the organization. Furthermore, the true measure of leadership is influence, nothing more nothing less. The capacity to influence others to participate is what defines a leader. As we have said before, people can get confused about titles and their connection to leadership. In most cases they think that just because a person has a certain title then that makes them leaders. But the reality says that leadership is about influence, influencing people to perform and do what they are supposed to do. This article also argues that the most a title can do is buy some time to increase or decrease the ability to influence the person who holds it. So titles can give individuals only temporary power to influence people and make them follow. So even if titles can be important in some situations like in the military where they have the power to control their subordinates, this does not make them leaders. It just gives them the power to use their power to give orders and make others follow them. A person will be perceived as a leader, regardless to his/her titles. Being seen as a leader doesnt have to do with the titles that you possess but its more about how you contribute to the success of the goals. This gives us the underlying base of our analysis. As we see here, Stever doesnt see any link between titles and the power to influence people but he believes that the actions of a person has more effect on influencing others and making them follow you or your orders. Charismatic Leaders Professor Martin Kilduff from University of Cambridge argues that charisma is considered to be an inherent quality that involves not just strong convictions and the ability to engage followers emotions, but also vision the articulation of lofty goals and the determined pursuit of those goals through the encouragement of others efforts. Also a numerous studies have concluded that charismatic leadership has positive effects on followers motivation, their satisfaction with leaders, as well as boosting leader effectiveness. With this being said, we see that charisma helps leaders to achieve the goals of the organization and makes people follow them. Leaders with charisma are seen to be more successful than others. Charismatic leaders are able to make others follow them easily without making much of an effort. But charisma is different from other personality attributes in that it is attributed to leaders by others their team mates, subordinates, and other people with whom they come into contact in the workplace and beyond. So informal or formal leaders need to interact with their followers and show their personality in order for them to be seen as charismatic. A research which was done by Martin Kilduff co-authored with Prasad Balkundi and David Harrison, forthcoming in Journal of Applied Psychology concluded that leaders who were active in their teams in terms of being at the centre of giving advice to subordinates and also soliciting opinions from subordinates tended to emerge as charismatic leaders in the eyes of those subordinates. Thus, in order for leaders to be seen as charismatic, whether they are formal or informal, they need to be active with followers, listen to their opinions and also provide them with guidelines or advices about work-related matters. Informal leaders are more likely to be seen more charismatic than formal leaders because they are more available and easier to be reached. They have better relations with their followers and they also solicit their opinions about important problems and issues. So formal leaders need to establish themselves as informal leaders in order to make their subordinates turn to them when they are faced with problems and issues. Leadership and Followers Several interrelated factors determine whether workers will follow their leader and how they asses leaders effectiveness. A leader will be seen as competent based on this improving performance, so if his/her performance is declining then followers will not comply. Followers will not only judge a leaders competence or performance but they will also judge leaders intentions. A leader who appears to be more concerned about followers and the missions than about the personal benefit or career advancement will gain more follower approval. Also a leaders who make visible self-sacrifices in the service of the organization will be viewed as more sincere and committed. Followers also consider the extent to which the leader appears to be similar to them in terms of values, beliefs, and other qualities they consider important. Followers who identify strongly with the group of the organizations are likely to have more trust in the leader who appears to be one of them and will make more favourable attributions about the leader. Because informal leaders dont have any authorized positions they are more likely to be seen as a member of the group. Therefore they are considered to share the same values and beliefs. They are trusted and seen as if they care more about the others and the organization goals than themselves. This is one of the reasons why the other workers consciously or unconsciously decide to follow the informal leaders. Informal leaders mostly have two roles, one is following the formal leaders and complying with their legitimate orders and the other one is informally leading their groups of colleagues. In order for these informal leaders to be effective they need to balance between these both roles, otherwise they would lose their identity and the trust or respect of the others. The challenge of informal leaders is harder because they are supposed to guide and support their followers plus satisfying their formal leaders. In order to further support this part of the study, a closer look will be taken on which factors influence the decision of followers to follow a leader. This will be supported by a study done by Thach, Thompson, and Morris 2006. One of the factors that influence followers to follow is motivation. In order for a leader to motivate his/her followers, he/she needs to show trust and respect and make them realize that their participation and achievements are important and essential for achieving the organizational goals and make it successful. This results to confident followers who believe that they can do the requested task. Mutual trust is the basis of an effective follower-leader relationship. This means that in order for followers to follow their leader, followers need to believe that the leader has their best interest. What also motivates followers is how similar their values and beliefs are with the leaders. Follower values determine their preferences for different types of leaders, they always look for leaders whose values match their own. When followers are comfortable with their leaders then they would follow them easily. Conclusion After having used several studies, articles and concepts, we got a clear insight about how leaders function, and influence followers. This study helped us answering the main questions this analysis which is: How would leaders with informal power influence their workers? Leaders with informal power influence followers by having personal characteristics, traits and skills. Being charismatic, showing trusts and respect to their co-workers, and believing in their ability to achieve the organizational goals and participating in its success are examples of these characteristics. Followers prefer leaders with whom they share values and beliefs. They are more comfortable in dealing with those leaders and other ones. Informal leaders usually fall in this category rather than formal leaders, this is because informal leaders are in the same hierarchical level and they are also considers as members of the same group. Informal leaders possess more of the personal power than positional power and from the used studies we came to know that personal power has more positive effect of followers than positional power has. Influencing followers is done by using the referent power and specially being role models to their followers. Titles and leaders are not directly connected. Leaders dont have to have any formal titles or power to be able to influence their followers and make them achieve the organizations goals. They can be leaders through their achievements, behaviour and the way they do their work. In this case, they can still be a role model for the followers and motivate them to do the work without having to use their titles. In the end we see that informal leaders influence followers not through titles or positions but through their charismatic personality, traits and skills. They are the people who followers look up to and want to follow.

History of Goods and Service Tax in Malaysia Essay

1. Introduction of GST Goods and service tax were first deliberated in 2005 with the intention to introducing it in 1st January 2007. However, it was withdrawn in the following year. In 2009, GST was revived with a proposed rate of 4% to replace current Sales Tax of 10% and Service Tax of 5% in a bid to diversify national revenues. However, the idea of GST still end up floating around as it has now been officially deferred. 2. Concept of GST Goods and Service Tax (GST), also known as Value Added Tax (VAT), is a broad consumption tax. The purpose of the introduction of GST is to spread the burden which borne by consumer in some particular areas into a wide range of goods and services with a lower tax rate. Thus, government’s revenue income will eventually increase to enable the further development and budget control to the country, other than just relying on petroleum and income tax revenues. GST is a multi-stage tax as it is levied on the â€Å"value added† created at the various stages in the importation†production†distribution chain of the product to which the tax is applicable. This tax structure helps to avoid the cascading effect embedded in current Sales Tax and Service Tax (SST) which are single-stage tax. It adopts a credit offset mechanism whereby tax charged on supplies (called output tax) made by a taxable business may be net off against tax paid on inputs (called input tax) to production. Only the difference is remitted to the tax authority. Nevertheless, the cost of GST is actually borne by final customers. However, not all supplies are standard rated supply, which are subject to proposed rate of 4%. Malaysian government has announced that some 40 items, mostly essential consumables and commodities will be free of GST, that is, either the items are exempted or given a zero-rating. The only difference is that input tax credits can be claimed by registered suppliers of zero rated supplies but not the exempted suppliers. Thus, lower income groups are protected. Furthermore, GST is a form of indirect tax as it is not a statutory obligation of a person to pay the tax unless certain GST taxable goods and services are consumed. Besides, the Malaysian government has indicated that Mandatory GST registration for suppliers will be based on a threshold of sales. Current indications are that the threshold will be set at RM500, 000.00 per year. Thus, with the introduction of GST, government is able to shift the reliance on direct tax to indirect tax for sources of revenue income to maintain its competitiveness as well as sustain long-term growth of the country. 3. Fate of GST in Malaysia The passage of GST in Malaysia has not been an easy sailing. As mentioned above, the idea of GST was first announced in 2005. However, it was shelved in 2006. Again, after the GST bill tabled in 2009, the second and third reading for GST is now being deferred again. Over-reliance on the direct tax and depleting petroleum are actually the major concern of government that contributes to the imposition of GST. Furthermore, the government is of the opinion that Sales and Service Tax (SST) has reached its threshold. To increase it the country’s exports uncompetitive. Under SST, exporters were incurring as much as RM1.4 billion annually. Therefore, the only way is to institute GST. GST is considered an equitable and comprehensive system of taxation that minimizes evasion and ensures a broader revenue stream. 3.1 Judgments from Macro-economic aspect By replacing the Sales and Service Tax with GST, the government is able to diversifies its sources of taxation to avoid being dependent on any particular tax base and the stability of tax revenue is ensured. As revenue from imports and taxes from the corporate sector may fluctuate, GST will not fluctuate, thereby bringing in a steady and sustainable revenue stream that is locally generated. However, the immediate outcry is that GST will cause the general price level goes up. However, empirical study in China indicates that GST implementation did not cause any inflation. Furthermore, public do not have to be over-worried of the continuous inflation as recent research also point out that GST may bring about a one-time increase in cost of living, but the impact on inflation is low. Meanwhile, according to the Ministry of Finance, Consumer Price Index is going to reduce 0.1% due to the lower GST rate. This can be further supported by studies that indicate prices did not increase significantly before and after the introduction of GST. Thereby it is clear that imposition of GST will only cause one time increase in general prices but would not necessarily lead to inflation which is continuous increase in the average of price over the time. Furthermore, a study done by Malaysian government also shows that households could enjoy annual savings of between RM14.50 and RM347 under SST system and GST system respectively. Additionally, it is indicated that the business sector could expect total annual savings of some RM4billion under the GST regime, while exporters would save RM1.4billion annually under a zero-rate system. Also, GST improve export competitiveness due to zero-rated and boost tourism because of the refund of GST.However, recent study argues that Malaysia can enjoy this trade competitive advantages only when there is no delay in input tax refund that cause increase in price of exports. Furthermore, there are many arguments against the indirect tax reform in developing countries. A country like Malaysia with presence of a substantial ‘informal’ sector, substituting VAT for border taxes is likely to deter the growth and development of the economy as a whole as VAT might drives firms from the formal sector into the shadow of informal economy. Many studies have indicated that developing countries consists of a very large size of informal economy. Informal economy is defined as the segment of the economy that escapes the tax net; it thus includes both the shadow economy and agriculture. Also, they argue that the imposition of VAT may also retard the development of markets, especially in the rural areas. As mentioned, imposition of GST diversifies government’s revenue sources and increase income. However, a previous study of GST in Mexico indicated that tax revenue increase might not be as large as suggested by standard literature due to the increase of the informal sector, shrinking the tax base. Furthermore, as a developing country, Malaysia may not benefit from the implementing GST due to the high administrative costs. Meanwhile, as GST was deferred, road shows, seminars and public education campaign are still being held by the authorities ever since the first announcement of GST in order to create awareness amongst the public about the oncoming tax transition. On the contrary, in the same time, GST opponents have been expressing negative by starting an anti-GST task force to protests against the implementation. Sentiment is that Malaysia is ranked more corrupt than ever and people are cynical that imposing GST will only be another avenue for corruption. From the discussion above, it can be seen that imposition of GST can improve collection of revenue in a more comprehensive, transparent and effective manner. Furthermore, more savings for households and corporate sectors can be expected with the substitution of SST with GST. Government has been paying effort in educating the public, however, hesitated in implementing the GST several times because of the lack of infrastructure to effectively collect the taxes. Furthermore, Malaysia is currently in a developing stage. There are still many informal sectors like agriculture sector and goods that are exempted from this system. Besides, the corruption issues in the country have yet to be addressed. It seems that the government needs more time to get ready for the implementation of GST and, thus GST might be implemented later rather than sooner. 3.2 Judgments from Micro-economic aspect (i) Corporate aspect GST is tax collected on behalf of government. Given the claimable input tax feature, GST is deemed not to be a business cost. However, GST will place a burden on the corporate sector (especially Small and Medium Enterprises), which will be responsible for collecting the new tax. SMEs may face the problem of cash flow difficulty due to the payment of GST upfront. Also the employment of qualified internal staff with the necessary experience can be quite costly. To add on to the problem, software programs would need to be revised to take into account the GST element hence adding on to the cost of operating a business. As conclude by studies, the compliance cost of SMEs is substantially higher than larger firms. Thus, GST compliance is four times more regressive to SMEs as compared to large firms. Again, representatives of the corporate sector have already expressed fears that corruption and bureaucratic ineptitude could raise the cost of administering the tax, thereby increasing companies’ operating costs. Furthermore, with regards to the threshold limit, survey done by The Associated Chinese Chambers of Commerce & Industry of Malaysia (ACCIM) ,with a small samples of 2000 people, has indicated that a threshold of RM5 million above is the most acceptable level instead of RM500,000. Extra compliance cost has a very high possibility of causing them to have substantial amount of revenue forgone. Even the neighbor country of Malaysia, Singapore, has a threshold limit of SGD$1 million. Shockingly, 80% of the respondents indicated that their computer systems are not ready to cater for the administration of GST. All of the reasons above clearly show that GST compliance is a very big issue to the corporate sectors, especially SMEs. High compliance costs that will be incurred for new software purchasing, staff training and low threshold limit have make them react very negatively towards the proposed GST. Thereby, it takes time for government to allay the fear of the corporate sectors and address the compliance cost issue. Thus, GST might be implemented later rather than sooner. (ii) Individual aspect Public are very reluctant to accept the implementation of GST. Some of them even formed a group representing the public to protest and express their non-approval for the introduction of the proposed GST with the contention of GST will â€Å"feed the rich and starve the poor†. Also, they are worried that those unscrupulous traders might take advantage of the GST to unnecessarily increase prices and pass this down to the final consumer. Actually, government has been spending time creating public awareness about the GST. However, the effort does not seem to be enough that most of the people do not actually realize that the lower income groups are protected as most of the basic necessities are actually zero-rated and tax exempted. Consumers have a choice to a certain extent whether to pay the tax should they decide to consume any of the non-essential goods and services. When it comes to exempting â€Å"basic essentials† from GST, however, there are arguments against list for political popularity. This is because too many exemptions can nullify the purpose of GST as a broad revenue base. Again, the â€Å"bureaucratic culture† in Malaysia further erodes the confidence of public towards GST. To sum up all the reasons above, given political sensitivity of the GST and the difficulty of controlling the reactions of the public and the corporate sector, the government might want to ensure that there is a long gap in between for the introduction of GST even though GST can be beneficial to the country. Besides, the Malaysian government needs time to establish computerization system and trained personnel for the tax transition. However, the budget deficit and depleting natural resources leave the federal government with little choice. Furthermore, the authorities has stressed that SST has reached its threshold, GST is the best option for the tax reform. Thus, given the reasons above and efforts of government create public awareness of GST, it might seen that GST is already in the pipeline and the current deferment was actually to allow the authorities to have more public awareness program and to give the corporate sector more time to get ready for the tax transition. 4. Equity of GST As indicated by government, GST provides equitable treatments as lower income groups are protected by zero-rated and exempted mechanisms. This method has been argued as simplistic as it ignores a number of important facts. First, empirical research indicates that there are significant difference in the pattern of expenditure between the poor and rich. Engel’s law point out that the share of expenditure on food and clothing is very high for the poorest households. According to the estimates of Hossain, VAT can be made less regressive with zero-rating of commodities that are consumed more by the poor households. Zero-rating â€Å"basic-commodities† protecting the poor and also the rich, since they also buy these commodities. In other words, zero-rating is an expensive way of protecting the poor since much of the â€Å"protection† is wasted on the rich. Second, the case for imposing VAT as has long been known a uniform VAT is likely to increase the price of many goods essential to the poor (Ahmad Stern 1987). Research on Bangladesh shows that a uniform VAT that disregards the differences in expenditure spending of the rich and the poor is significantly regressive as the poor suffer 2 to 3.5 percent loss in their income while the rich benefits from such reform. Because the poor may consume a relatively small amount of such products, it is undoubtly true that much of the benefits of such exemptions will go to the non-poor. Third, before the introduction of GST, the price of all commodities in fact has already incorporated an indirect tax component that is the tax charged on inputs for production. Therefore, no commodities will increase in price to the full extent of GST. Moreover, proponents of the tax reform have neglected the presence of a large informal economy in Malaysia. According to Emran and Stiglitz, the dramatic shift in favor of VAT as the main instrument for revenue rising in developing countries which have a large informal sector is misguided both on efficiency and equity grounds. Even a uniform broad-based VAT may be more progressive than more nominally progressive taxes (such as the personal income tax) that in practice burden only a limited group of wage-earners. This can be happen, for instance, informal sector producers that produce a close substitute of the formal GST-liable commodity will get high profit without bearing tax while formal sector producer may get lower profit and bearing tax. Therefore, informal sectors of a Malaysia might distort the equity treatment of GST amongst the corporate sectors. A further consequence is that the tax base of the GST is eroded and either less revenue is available for national expenditure prio rities, or higher rate of GST is required. Thus, the equity of GST still remains a question. The actual impact of a broad-based GST needs to be estimated by econometric model in order to answer the major arguments of broad-based GST. 4. Conclusion GST has been proposed by government to reduce the reliance on direct tax and the petroleum revenue. Also, it was planned to replace current SST. With a broader base for goods and services being subject to GST, the revenue for the government is expected to be higher. However, the implementation GST is being deferred again due to the political sensitivity and the negative reaction of the public. Furthermore, the lacking of infrastructure to effectively collect the taxes, negative responses by the corporate sectors and protests against GST by the public contributes further to the deferment of GST. However, it does not mean GST going to be shelved forever as Deputy Director of Customs, Subromaniam Tholasy, has made a clear statement that the implementation of GST has only been deferred, not cancelled. Also, the officials have been keen to stress that both consumers and businesses are likely to make savings under the GST. Thus, it is obvious that the GST already is in the pipeline. However, many things have to be done for the imposition of GST, thus GST might be implemented later rather than sooner due to the substantial time and cost incurred by the corporate sector and government in the preparation for the transition. Also, equity of GST still remains an issue. In order to make the implementation of GST to be successful, the government should start an extensive education and public awareness drive now to explain how the tax works and its impact on prices. Also, the government should address its major problem which is corruption to regain the confidence of public. Also, they has to take into consideration of the neglected factors such as informal sector and reconsider the equity issue in order to make the implementation of GST to be equitable and efficient.

Abigail Adams: Witness to a Revolution

Abigail Adams: WITNESS TO A REVOLUTION Abigail Adams, Witness to a Revolution, was one of the greatest writers of her age. She passionately campaigned for women's education, denounced sex discrimination, and matched intelligence not only with her husband, John, but also with Thomas Jefferson and George Washington. She wrote more than two thousand letters about her legacy that her family members saved, recognizing their importance and ignoring her plea to burn them. Abigail’s letters are her biography and it is through them that we understand her unique character, sense of humor, independent spirit, and her English language.It is through her writing that opens a window to our nation’s history and brings Abigail Adams and her time to life. On November 11, 1744, Abigail Adams was born Abigail Smith. She lived in a small town of Weymouth, Massachusetts and lived with her two parents William and Elizabeth Quincy Smith. She had two sisters and one brother, Mary, Elizabeth, an d William. When Abigail was a little girl she always asked her mother if she could go to school. Her mother said no so her grandmother taught her to read and write at home.Abigail loved to read books from her father’s library and listened in on her father’s meetings. She loved books and politics and was a very clever and talented girl. As a teenager, Abigail had many friends that she wrote letters to. She was always very self-conscious and worried about her spelling and punctuation since she didn’t have a proper education. One of Abigail’s many friends who wrote letters to her was John Adams. When Abigail was nineteen years old she married John Adams on October 25, 1764.John Adams was a lawyer in the Smith family home of Weymouth, Massachusetts and was married by Abigail’s father, Reverend Smith. As a married couple they moved to Braintree and lived in a house that John inherited from his father. John was a very intelligent man who wanted to become a farmer as a boy, but his father discouraged it and sent him away to school. John got his education from Harvard College and this is where he became a lawyer. John and Abigail had five children together. Their first daughter, Abigail nicknamed Nabby, who was born on July 19, 1765.Their second child was John who was born on July 17, 1767. Susan was born December 28, 1768, but passed away a year later. Their son Charles was born May 29, 1770 and on September 15, 1770 their son Thomas was born. In 1767, the Adams family was living in Braintree Mass. When the British started requiring taxes on American documents, John knew he wanted to help the colonies and became a well-known spokesman. He was away from home a lot so in 1768, Abigail moved her family to Boston. After the Boston Tea Party event they moved their family back to Braintree.While John was away traveling it was up to Abigail to raise her first daughter Nabby, along with managing the farm and family money. She also taught a black slave how to read and write. When John was away she was often very lonely and writing letters made her feel better along with the birth of her second child John. John and Abigail had a very good marriage and relationship. She was very intrigued with politics and books and would often ask John what was going on in the world, which was very unusual for women to do so. They often talked about women’s rights.When John was away Abigail would write to him reminding him of the women. Meaning that he should include women’s rights in the continental congress. In 1770 the Boston Massacre happened where the fire bells were ringing. Abigail rushed home afraid her house may be on fire but were relieved to find out they were safe. The bells sounding the town meant trouble. Some teenage boys were throwing rocks and snow at British soldier, which lead to the soldiers shooting five people dead, and six were very injured. This even was known as the Boston Massacre.In 1775 the batt le of Concord and Lexington marked the beginning of the Revolutionary War. Many people fled Boston for fear of attacks. Abigail invited them in for food and shelter and wrote, â€Å"The house is in state of confusion. † When Johnny was eight years old, Abigail took her son to watch a battle on Breed’s Hill in Boston on June 17th, 1775. After seeing the terrible battle of Bunker Hill she wrote to her husband who showed her letters to George Washington and other leaders about the people’s suffering. In August 1776 the Declaration of Independence was written.Abigail became the first First Lady to ever live in the White House when John was elected Presidents over the United States. As first Lady she spoke out in favor of the women’s rights. Abigail Adams in an example of a life lived by women in colonial, Revolutionary. While she is best known as an early First Lady and the role she took for women’s rights in letters to her husband she is also known as a farm manager and financial manager. Abigail passed away on October 28, 1818 of typhoid fever. She is buried beside her husband in Quincy, Massachusetts.She was seventy-three when she died and her last words were, â€Å"Do not grieve, my friend, my dearest friend. I am ready to go. And John, it will not be long. † –Abigail Adams The wife of the second president and the mother of five children, Abigail Adams was an extraordinary women. She experienced the Revolutionary War and saw the battle of Bunker Hill from a hilltop near her home. The letters written by Abigail Adams to her friends and family bring the Revolutionary period alive, with every day life changing events of her time.She is given her own place in history in this award winning biography that she deserved and more. Natalie S. Bober wrote Abigail Adams, Witness to a Revolution because writing biographies did not only fascinate her, but her goal was to make Abigail Adams heard by everyone. She wanted us rea ders to know how much of a role she played in sticking up for women’s rights, being a good wife to her husband by caring for her family while he was away, and the decisions she had to make as a strong independent woman that changed the Revolutionary period and made her who she is today.I don’t think the author took any sides or had any arguments while reading this book. Natalie Bober took a lot of time to research and search many old documents to put together this award winning biography. Reading this book I would recommend it to any strong independent women to reinsure us that there are great role models for us women to look up to. I only hope to be as courageous, intelligent and independent as Abigail Adams some day.

A Man s Search For Meaning - 1884 Words

Every day hundreds of college students are on the path to figure out what they want to be when they grow up. â€Å"78 percent said that their first goal was finding a purpose and meaning to their lives† (100). In a Man’s Search for Meaning, psychologist Viktor E. Frankl discusses how to find the meaning of one’s life. Frankl spent a couple of years in a concentration camp during the Holocaust. There he many battles to fight to find the will to continue to live. He said, â€Å"every man was controlled by one thought only: to keep himself alive† (5). It was during this time Frankl developed his own school of psychology called logotherapy. Through reading his book I have been able to deepen how I perceive parts of my life and my purpose in this world. Through the book Frankl goes deep into his idea of logotherapy. Logotherapy is based on the idea that â€Å"striving to find a meaning in one’s life is the primary motivational force in man† (99). Some may ask, â€Å"what exactly is the meaning of life?† According to Frankl, the meaning changes from person to person and is described as one’s â€Å"own specific vocation or mission in life to carry out a concrete assignment which demands fulfillment† (109). In other words, everyone has their own purpose that cannot be completed by anyone else because each is unique to the individual. Next one may ask, â€Å"how does one discover the meaning of life?† Logotherapy focuses on three different ways an individual can discover their own meaning of life. One way is â€Å"byShow MoreRelatedThe Man s Search For Meaning1360 Words   |  6 PagesThe Man’s Search for Meaning demonstrates what a human being can endure in spite of terrible state of affairs such as the Holocaust. I believe Viktor Frankl survived this cruel occurrence because it is not only his psychiatrist background but his optimistic and meaning for life that also saved him. 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