Reintroduction of voluntary disclosure tax programme will help replenish govt coffers - Tax institute

KUALA LUMPUR - The re-introduction of a special voluntary disclosure programme from June 1, 2023 to Dec 31, 2024 to allow a 100 per cent waiver of penalties on unpaid direct and indirect taxes will help replenish the government's coffers, as well as benefit taxpayers who wish to capitalise on the initiative.

The reintroduction of the programme was announced during the Budget 2023 announcement by Prime Minister Datuk Seri Anwar Ibrahim on Friday.

President of Chartered Tax Institute Malaysia (CTIM) Chow Chee Yen said the appetite for taxpayers to step forward to voluntarily disclose unpaid taxes may not be as strong unless there are compelling reasons to do so.

"Communication of expectations and transparency between the tax authorities and taxpayers are also expected to affect the desired outcome of the programme,” he said in a statement.

The cut in tax rate by two percentage points for the RM35,001 to RM100,000 taxable income band is expected to benefit approximately 2.4 million taxpayers of the middle-income M40 group, he added.

"This is a recognition that the rising cost of living has also hit the M40 group hard beside the B40 group that has been receiving the lion’s share of government assistance.

"It is observed that the government is willing to extend the tax rate cut to those in the RM35,001 to RM50,000 taxable band who were not beneficiaries of a similar proposal (previously),” he said.

On the other hand, Chow noted that the government has proposed to raise the tax rate by 0.5 to two percentage points for the RM100,001 to RM1 million taxable band, which is expected to affect approximately 150,000 taxpayers.

"This readjustment of tax rates across the bands is consistent with what appears to be the government’s thinking of helping those who are facing hardship and extending the tax base to those who are able to afford it,” he said. - BERNAMA