MCA remains firm in opposing all forms of wealth and inheritance taxes

THE MCA presidential council and central committee have never put forward any proposal for wealth and inheritance taxes to the government. It remains the consistent decision and position of the MCA central committee to oppose any form of wealth and inheritance taxes.

Since Independence, the successive leaderships of MCA had long fought for the gradual abolition of the Estate Duty Enactment 1941, which ultimately was repealed in November 1991. Before this, it allowed the government to levy between 0.5% to 10% of a deceased’s estate if found to be valued over RM2mil.

When Pakatan Harapan was in power, the erstwhile finance minister Lim Guan Eng in 2018 had enhanced the real property gains tax (RPGT) to include the disposal of properties of more than five years. Even when a child inherits property from their parents, he or she has to pay 5% in RPGT. Moreover, the base year for RPGT valuation was set to 2000, effectively turning it into an inheritance tax in disguise.

In response, MCA president Datuk Seri Dr Wee Ka Siong, who was an Opposition MP at the time, fought tooth and nail against the policy in Parliament. In 2019, after Dr Wee raised the issue in the Parliament’s special chamber, the Finance Minister finally announced the revision of the base year to 2013.

Meanwhile, there were talks that the Pakatan administration was planning to introduce new taxes including the capital gain tax. Immediately, MCA conveyed its consistent position in Parliament, that we oppose all forms of wealth, inheritance and capital gain taxes. Ultimately, the Pakatan government yielded on implementing new taxes.

Whether in government or in the Opposition, the central leadership of MCA organises annual budget dialogues through a think tank, the Institute of Strategic Analysis and Policy Research (Insap), to solicit feedback from the Chinese guilds and associations, and communicate the position of the Chinese community to the Ministry of Finance.

On Oct 19, 2020, two weeks before the tabling of Budget 2021 in Parliament, the MCA president had arranged for a social dinner between leaders from major guilds and associations, and Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz. The Finance Minister concurred then that a wealth tax was detrimental to the overall investment climate in Malaysia, that it imparts the wrong message to foreign investors; and as such, the government will not push for any wealth tax.

MCA reiterates any party decision must be deliberated and finalised by the MCA presidential council and central committee.

Malaysia is a country that practises parliamentary democracy, and we respect every citizen’s right to freedom of expression. However, from a political party’s standpoint, the statements of each divisional leader are strictly personal viewpoints and do not represent the position of MCA.

Datuk Chong Sin Woon

MCA secretary-general

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