AG's Report 2015: RM4 billion lost in 2014 from companies who failed to pay taxes

PETALING JAYA: The government has lost over RM4 billion in 2014 from companies who failed to pay their taxes, the Auditor-General Report 2015 revealed.

It disclosed that of the RM8.224 billion total tax arrears for 2014, companies tax arrears amounted to RM4.365 billion (53.08%).

Following an audit on the Cheras, Wangsa Maju, and Large Taxpayer branches, it was found that the management of civil suits taken by the Inland Revenue Board (IRB) towards these companies was less than satisfactory, including non-compliance of work procedures.

"These include delay in registering 140 out of 312 summons (44.9%) in court amounting to RM113.94 million, delay in delivering 108 out of 312 summons (34.6%) to companies amounting to RM95.5 million, and no action taken after judgement was obtained in 29 cases, amounting to RM12.44 million.

"No action was taken towards seven companies which were unable to obey the tax installment amounting to RM634,810 and submission of bad cheques for tax installments amounting to RM941,763," it added.

To improve the management of its civil suits, the AG has recommended that IRB enhance its summons management efficiency, starting from the aspect of delivery of summons.

"It is also recommended that IRB efficiently monitor installments made by the companies and implementing decisive actions to ensure companies pay tax arrears as per stipulated," it added.