Tax-free bonuses will not affect govt revenue collection, says Cuepacs

KUALA LUMPUR: The tax exemption on bonuses or special financial aid for civil servants nationwide will not affect the government's revenue collection target.

Congress of Union of Employees in the Public and Civil Services (Cuepacs) president Datuk Adnan Mat (pic) said the move announced by Prime Minister Datuk Seri Anwar Ibrahim was reasonable and reflected his concern for the welfare of civil servants.

"The bonus received by civil servants in states and at the federal level is around RM700 to RM2,000 each, and if the amount is exempted from tax, it will not affect the government's tax revenue collection.

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"In fact, Cuepacs also learnt that the tax collection by the Inland Revenue Board has exceeded the target for 2022," he said in a statement on Friday (Jan 20).

Adnan said the bonus given by state governments to civil servants also serves as a special aid to reduce their financial burden.

As such, it is inappropriate to place a tax on the bonus, considering that the amount is not that high and was meant to assist them, he said.

Earlier on Friday, Anwar announced that bonus for all state civil servants would be tax-free. – Bernama