Clear the air on the low tax in Sabah

Clear the air on the low tax in Sabah

Why Sabah is only targeted to contribute RM4b in 2017 out of the total expected in national collection of RM127b?

At this level of low taxes collected for decades in Sabah, it would give policies deciders that Sabah would be accounted low in getting a return of that revenue for the development of the State.

Have the policies makers consider how only RM4b is from collection in Sabah when so many multi-national and national companies accounted their tax cases to the central IRB in Putrajaya /KL or other relevant states in West Malaysia/ Sarawak. Such companies – number unknown – have massive operations in Sabah in the oil/gas and the oil palm plantation/timber trade for decades and never show separate amount of tax payable for the Sabah sector.  Even Government link companies (GLC) like MAS have substantial operations in Sabah as KKIA is ranked the second busy airport in the nation.  AirAsia also have much revenue from Sabah operation.  Do these companies operating in Sabah pay separate taxes for the Sabah sector, and if not there should be a separating accounting preparation for Sabah sector at least for the statistical identification/classification.  

Also in the news report it was stated that the Newly-appointed IRB Chief Executive Officer Datuk Sabin Samitah, a Sabahan also mentioned of tougher approach to go after those taxpayers with the intention to collect more taxes and penalties in tax settlements in Sabah.

Sabin also said that “there are still a lot of Sabahans who are not familiar with the provisions of the law on income tax,"

Can the IRB tell us how much of the RM127b collected is for penalties or compounds for tax offences and delays in payment of tax due?

Isn’t it appropriate that penalties and compounds collected from taxpayers (some innocent) should be utilised to educate the taxpayers –some already in “distorted” mentality – to greater awareness of the tax system always changing in regulations, laws, guidance, and compliance challenge?

Instead private or independent tax professionals and taxpayers are paying for expensive seminar/conference fees to attend updating forums annually and this simply defeat the rate of more participation in such avenues.  Only those who can afford such fees and cost of attending such forums can make it. So we look forward to the enhancement of awareness by the IRB in free seminars for the taxpayers for win-win scenarios.

Joshua Y C Kong 22/12/2016