KUALA LUMPUR: Individual taxpayers with taxable incomes exceeding RM100,000 annually contributed a significant 86% of the total individual income tax collected in 2023, says the Finance Ministry.
It said this contribution formed part of the RM37.77bil in individual income tax collected by the government for that year, which represented 22% of the total direct tax collection of RM171.34bil.
"Of this, the top 20% of taxpayers, with taxable incomes over RM1mil, played a substantial role in bolstering Malaysia's fiscal resources.
"Their contributions are crucial in maintaining economic stability and supporting national development," said the ministry in a written Parliament reply on Aug 11 (Monday).
Aminolhuda Hassan (PH-Sri Gading) had inquired about the number of individuals in Malaysia with net wealth exceeding RM100mil and their tax contributions.
The ministry said such specific data was unavailable in the Inland Revenue Board's (LHDN) records, as net wealth does not directly correlate with income tax liabilities.
"Certain assets are not subject to income tax unless sold or disposed of, such as real estate or specific investments," it said.
The government, it added, appreciates the role of high-income taxpayers in bolstering economic stability and strengthening the country's fiscal position.
"The government remains committed to enhancing tax compliance and addressing tax leakage issues, particularly among high-income individuals with assets and wealth not aligning with reported taxes.
"This includes income kept in offshore accounts, cross-border transactions, domestic transfer pricing, online activities and shadow economy cases," it added.
In addition to tackling tax leakage, the government is focused on improving tax administration efficiency through digitalisation and encouraging tax compliance via ongoing awareness efforts.
"We are continually refining the structure and treatment of income tax to ensure a fair and progressive taxation system in Malaysia," it added.
