KUALA LUMPUR: The increase in direct tax collection last year by the Inland Revenue Board of Malaysia (IRB) was based on the economic growth recorded in the year of assessment 2018, said the Minister of Finance Lim Guan Eng (pix).
He was commenting on claims made by several quarters that the encouraging tax collection was actually based on 2017’s economic performance, did not reflect the current state of the economy nor was it the outcome of effective tax-related strategies set by the Pakatan Harapan government that came into power after the election.
“In fact, it is reflective of a resilient economy coupled with the effectiveness of a clean leadership and an administration based on the principles of competency, accountability and transparency.
“It was also supported by a 34% hike in collection from the Sales and Service Tax (SST) which was introduced in 2018,” Lim said, adding that the ministry would continue to issue statements on the economy, based on facts and accurate figures.
On Sunday, the minister announced that the IRB achieved a new record in direct tax collection last year, with RM137.035 billion collected, which was 11.13% more than the RM123.312 billion collected in 2017.
He also said the tax paid, for instance, by a company in 2018 would be made based on estimated income for the year.
Lim added that tax estimates for 2018 must be submitted to the IRB within 30 days before the year begins and instalments must be paid throughout 2018 based on the estimates determined.
Real property gains tax and stamp duty collection, however, would not be associated with the previous year of assessment.
“This is because the tax or duty on the disposal of an asset is imposed in the year of disposal.
“Similarly, for stamp duty on instrument or agreements, duty will be imposed in the year the instrument or agreement is executed or signed,“ he explained.
As for SST collection for 2018 by the Royal Malaysian Customs Department for 2018, Lim said proceeds rose 34 per cent to RM5.4 billion versus the target of RM4 billion set when SST was implemented on Sept 1, 2018.
The higher collection was due to efforts undertaken by the government to educate businessmen via 18 engagement sessions held, nationwide, and attended by Lim. — Bernama