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By Karen Bong
KUCHING, Feb 9: Fret not those who have received letters from the Inland Revenue Board (IRB) on a Voluntary Declaration Special Scheme that encouraged earners to report their income and file taxes.
Instead, Democratic Action Party (DAP) Sarawak chairman Chong Chieng Jen urged income earners to seize this opportunity to voluntarily make full disclosure of their income as the penalty imposed would be between 10 to 15 per cent only, compared to 100 to 300 per cent without the scheme.
“Of late, many who have received these letters felt disturbed and worried. I want to state here that the issuance of these letters is a gesture of goodwill by the Pakatan Harapan (PH) government,” he told a press conference on this matter here today.
The scheme, he said, provided a special offer to those who had in the past under-declared their income or had taken their money overseas.
Under the old Barisan Nasional (BN) regime, Chong, who is also the Deputy Minister of Domestic Trade and Consumer Affairs, explained that there was an agreement among all Asean countries to automatically exchange banking information.
“With that international agreement, all foreign bank accounts in the name of Malaysians will be disclosed to Bank Negara and vice versa.
“This means, if you have accounts in Singapore or Thailand or the Philippines, for example, the relevant foreign authorities will voluntarily disclose the accounts to the Malaysian authority.”
Under the existing law without the scheme, he added that under-declared income or revenue would be subjected to the necessary tax amount plus a 100 to 300 per cent penalty.
“But now under the PH government, the scheme allowed one to pay the necessary tax amount from the voluntarily declared amount plus a 10 per cent penalty.”
On or before March 31, income earners only need to pay 10 per cent penalty, while after March 31 and before June 30, they will be subjected to 15 per cent penalty.
“Thereafter, your income will be deemed legitimate, and the IRB will no longer go after or investigate the revenue and expenses for those years you have voluntarily declared. It is still much lower than the top bracket income of about 24 to 26 per cent.”
Chong reiterated that this was a good gesture of the new government, which noted that many taxpayers were reluctant to pay taxes in the past as they assumed the tax money would be used by the old (BN) regime to pay debts like those involving 1MDB, corruption and wastages.
“Under the new regime, I can assure every taxpayer that every ringgit paid will be used to the fullest of its worth.”
For those without income to declare or below the income threshold, and those who had dutifully and legitimately filed their tax returns, Chong assured that they need not have to be worried or be upset about the alert letter.
However, he advised those who have not declared their income before or unsure if they qualify for tax filing to consult an accountant or tax consultant to get confirmation on their status.
“If there was under-declaration or technical mistakes in the declaration of income, please seize this opportunity to make a voluntary declaration on or before March 31, and you only need to pay 10 per cent (penalty) of the declared portion of the income.
“This is the difference between the BN government and the PH government. We want a fresh start for everybody. As such, we came out with this special scheme.” — DayakDaily