IRB Exceeds Target With RM124bil In Collections


The Star newspapers today reported that the Inland Revenue Board (IRB) has exceeded its targeted tax collection for the year 2012. In the article, it was also reported that Finance Minister II Datuk Seri Ahmad Husni Hanadzlah said that the IRB’s tax collection to date of almost RM125 billion was a record.

Several points that us taxpayers have to observe from the report are these:

  1. The government’s initial budget for direct tax collections for 2012 was RM109 billion. Once the IRB was on track to achieve the target, the government revised the budget upwards, This is not the first time that the government has revised the tax collections target for the IRB. For that matter, this is NOT the first time that the target was revised for 2012. The IRB is constantly under pressure from the government to collect taxes to meet the government’s annual expenditure.
  2. The IRB has resolved more than 1.9 million audit cases for 2012 resulting in an additional tax (AND PENALTIES) collections of RM2.94 billion. The number of cases represent a significant increase of 50.42% from the number of cases resolved in the year 2011. From point 1 above, it is obvious that the most effective way for IRB to increase its tax collections is through increasing its tax audit initiative. So let the taxpayer beware!

It is therefore very important that taxpayers are aware of their responsibilities (and rights) under the self-assessment system. Taxpayers are reminded to report their income and likewise, claim deductions for expenses correctly to avoid a 45% penalty being imposed on the tax undercharged, as a result of a tax audit.

The chances of being selected for a tax audit nowadays are VERY HIGH.

Read more about the article in the Star online papers here:

http://thestar.com.my/news/story.asp?file=/2012/12/30/nation/12518025&sec=nation

 

About Richard

Richard Oon Hock Chye has more than 25 years of experience in taxation and business advice, with particular expertise in Malaysian property law. He began his taxation career with Deloitte Touche Tohmatsu, a ‛Big Four’ accounting firm, before starting his own practice, ConsulNet Tax Services Sdn. Bhd., in 1996. He is currently the National Tax Director of TY Teoh International, one of the leading consulting service providers in Malaysia. It is a member of the MSI Global Alliance, a global network of more than 250 independent legal and accounting firms, in over 100 countries. Richard sits on the board of two companies listed on the Main Board of Bursa Malaysia, as an independent non-executive director. He is also a regular contributor to several magazines and publications, and has shared his tax expertise on numerous occasions with organisations and property developers. As well as being a member of the Malaysian Institute of Accountants (MIA), Richard is a fellow member of both the Association of Chartered Certified Accountants (ACCA) and the Chartered Tax Institute of Malaysia (CTIM). He is a Certified Financial Planner (CFP) and holds a tax agent licence issued by the Ministry of Finance. Richard is also the author of the book, ‘Every Property Investor’s Guide To How To Pay Less Tax Legally’.

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