Lim Guan Eng : Govt Going After Rich Tax Evaders, Including Probing Overseas Assets - 79,786 Tax Payers Underdeclared Their Income - The Coverage
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Lim Guan Eng : Govt Going After Rich Tax Evaders, Including Probing Overseas Assets – 79,786 Tax Payers Underdeclared Their Income

“The Government is cracking down on people with “extraordinary” wealth beyond their (known) income to recover the nation’s lost tax revenues, including looking at overseas assets, said Finance Minister Lim Guan Eng.

To do this, the Inland Revenue Board (IRB) is working with tax authorities worldwide and also using big data analysis.

Lim said the Government has implemented an Automatic Exchange of Information agreement with tax authorities globally, under which each country will share financial information of individuals including their financial transactions, assets, and other tax-related information.

The country-by-country reporting programme is implemented through the Organisation for Economic and Co-operation and Development (OECD) initiative and will allow the IRB to do more comprehensive probes into individuals with offshore assets, he said.

“The Government has asked LHDN (the Malay acronym for IRB) to audit and investigate individuals with extraordinary income that are more than their income to recover the nation’s lost revenues,” Lim said.

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Lim also urged tax evaders to participate in the Special Voluntary Disclosure Programme or face heavy fines.

“We have information from many countries who have signed this agreement to share information… IRB has access and will know your assets that are kept overseas,” he said.

According to IRB chief executive officer Datuk Seri Sabin Samitah, they have identified 79,786 tax payers, companies, organisations and corporations with extraordinary wealth who have failed to declare their income or have underdeclared their income.

“We have a taskforce that will monitor social media, newspapers and magazines to identify individuals with extraordinary wealth and we will do data matching with the income that they declared,” Sabin said.

Sabin said IRB will serve notices to these tax evaders, asking them to voluntarily disclose their income under the Special Voluntary Disclosure Programme.

The notices will be served under Section 79 of the Income Tax Act 1967 to request more information and an explanation.

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Those who have receive notices must respond to IRB within 30 days.

Failure to do so is an offence under Section 120 of the Income Tax Act. which metes out a fine of between RM200 to RM20,000, or jail up to six months, or both.

The Special Voluntery Disclosure programme commenced on Nov 3 and will end on June 30, 2019.

Those who voluntarily disclose their income before the deadline will face a 10% to 15% penalty of the unpaid taxes.

Afer this period, tax evaders who are caught will face a 80% to 300% penalty.

Those who wish to voluntarily disclose their income can submit their income tax returns via e-filing or manual forms while those who have declared their income incorrectly can send a letter to IRB via email or post with a declaration of their real income.

Sabin adds that the tax collection this year, date ending Nov 11, has increased by 11% compared to the same period last year.

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He attributed the increase to the petroluem tax and the tax payers’ growing confidence on the government’s financial management.

 

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