(May 16): Malaysia scrapped a 6% rate on the goods-and-services tax, fulfilling a campaign promise by Prime Minister Mahathir Mohamad that helped him win last week’s election.

The GST will be set at 0% from June 1, the Ministry of Finance said in an emailed statement. All businesses must comply with the ruling, it said.

Mahathir’s coalition had pledged to abolish the tax -- which disgruntled voters blamed for their rising living costs since it was imposed in 2015 -- and replace it with a more modest sales-and-services levy. Economists and credit-ratings companies like Moody’s Investors Service have warned the move would cut government revenue and widen the budget deficit if not offset by revenue raising measures.