Not the right time to impose CGT on disposal of shares

KUALA LUMPUR: The government does not consider it suitable to impose capital gains tax on the disposal of shares of listed companies at this time, said Deputy Finance Minister Lim Hui Ying.

"The approach is taken to ensure that the local stock exchange can continue to be competitive," she said when winding up the debate on the Income Tax Bill (Amendment) 2024 in the Dewan Negara today.

The Dewan Negara today passed two bills involving tax, namely the Income Tax Bill (Amendment) 2024 and the Labuan Business Activity Tax Bill (Amendment) 2024.

Lim said the Income Tax Bill (Amendment) 2024 aims to amend the Income Tax Act 1967 (Act 53), comprising nine clauses to enhance the tax policy and administration.

The proposed enhancements include the implementation of capital gains tax (CGT), the implementation of e-Invoice, and tax administration amendments.

She said the CGT is implemented to broaden the tax base, aligned with international best practices.

"Additionally, the implementation of e-Invoice is to improve the efficiency of tax administration in dealing with the challenges of the shadow economy as well as curbing the continuous leakage of national tax revenue," she said.

Meanwhile, she said the Labuan Business Activity Tax (Amendment) Bill 2024 aims to implement amendments related to the implementation of the e-Invoice, such as amendments to the Income Tax Act 1967.

This bill contains two clauses that amend the Labuan Business Activity Tax Act 1990, with the amendments deemed to have come into force on Jan 1, 2024. - Bernama