Direct tax collection at record RM137bil last year

"Encouraging environment: Tax revenue from petroleum contributed RM20bil or 14 to direct taxes, according to Lim. — Bernama

"Encouraging environment: Tax revenue from petroleum contributed RM20bil or 14 to direct taxes, according to Lim. — Bernama

PETALING JAYA: Malaysia’s gross direct tax collection in 2018 broke previous records in terms of highest amount received.

Finance Minister Lim Guan Eng announced that the Inland Revenue Board had collected RM137.03bil last year – an increase of 11.13% from 2017.

This is a new record in direct tax collection, he said, in which the amount broke the record set in 2014, which amounted to RM133.7bil.

“The rise is attributable to increased collection from components of taxpayers such as companies, individuals, petroleum, cooperatives, stamp duty and others,” he said in a statement here yesterday.

He added that the increase in direct tax collection reflected the effectiveness of a clean leadership, and that economic growth was encouraging in 2018.

Corporate tax was the largest component of the direct tax collection, contributing RM70.03bil or 51.11% of direct taxes.

This was followed by individual tax component which contributed RM36.06bil or 26.32% of direct taxes.

Tax revenue from petroleum contributed RM20.08bil or 14.66% to direct taxes.

Other components include stamp duty collection at RM5.93bil (4.33%), withholding tax collection at RM3.17bil (2.27%), real property gains tax collection at RM1.46bil (1.07%), cooperatives tax collection at RM0.17bil (0.12%).

Labuan International Offshore Centre and other taxes amounted to RM0.163bil, or 0.12% of total direct tax collection.

Lim said the tax collection performance was a result of effective tax-related strategies implemented by the Pakatan Harapan government.

He added that these strategies include beefing up tax enforcement activities, having more focused tax education programmes and improving the process of imposing travel restrictions on taxpayers with tax arrears.

“The high level of integrity and transparency of the Pakatan Harapan government in spending every sen of tax collected from the rakyat also played a very important role in improving the level of compliance among taxpayers and led to this increase,” he said.

He also thanked the rakyat who carried out their duty in paying taxes and he hoped that they would continue to do so for the advancement of the country.

He further urged for taxpayers who have tax arrears to participate in the Special Voluntary Disclosure Programme so they would only be imposed a penalty rate of 10% and 15%.

After the programme ends on June 30, he said, taxpayers with compliance issues would be imposed with a penalty rate of 80% to 300%.