PETALING JAYA: The Cabinet has agreed to extend the special reduced penalty rate for taxpayers to disclose any previously undeclared income until June 30, says Finance Minister Lim Guan Eng.
Originally, the Government had in February agreed to a reduced penalty rate from 300% to 10% if declaration is made before March 31, 2019, or 15% if it is reported between April 1 and June 30 under the Special Voluntary Declaration Programme (SVDP).
“Following overwhelming response from taxpayers, we will extend the 10% special penalty rate until June 30.
“Declaration made between July 1 and September 30 will see the penalty raised to 15%, followed by 45% after that,” he said in a statement on Sunday (April 7).
The SVDP, which was launched in November last year, was offered to five taxpayer categories, including individuals, companies and organisations that have not registered with the IRB, and those who have registered but have not submitted their income tax return forms, petroleum return forms or real property gains tax return forms.
Under the SVDP, individual taxpayers are required to disclose all undeclared income made until Dec 31, 2017, while businesses have to disclose all such income for the accounting period ending March 31, 2018.
As of March 31, Lim said that a total of 381,979 taxpayers had voluntarily disclosed all previously undeclared income to the Inland Revenue Board (IRB).
“With this extension, we hope more taxpayers will join the SVDP to enjoy the low penalty and thus, reduce their tax burden.
“The programme focuses primarily on taxpayers who have bank accounts overseas and have income generated in Malaysia, but have not reported it to the IRB,” he said.
The government, he added, also welcome any taxpayers with no offshore accounts to voluntarily declare unreported income generated within Malaysia.
Lim noted that the IRB also complied with the government's direction last year for investigations to be conducted without threats, including not raiding any taxpayer's house or office accompanied by armed personnel in balaclava masks.
“Any party who disobey these instructions must be reported to the IRB or the ministry,” he said, adding that the IRB would accept each voluntary disclosure in good faith with no audit or investigation conducted.
“In fact, the IRB will also issue an acknowledgement letter for each voluntary declaration,” he added.
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