Site Last Updated 11:03 pm, Tuesday

Tax waiver incentive to donate to places of worship

Posted on October 22, 2011, Saturday

KUALA LUMPUR: It is a weekly routine for businesswoman Lim Ai Ing to pray at a Buddhist temple in Old Klang Road and, without fail, squeeze some cash into the donation box.

Her generosity as a devotee does not end there, however. Whenever the temple management organises some fund-raising activity, she donates more without any hesitance.

When she heard that under Budget 2012, the government will give tax exemption to those who contribute to registered places of worship, she was happy that her contributions are now going to be recognised and appreciated by the government.

“This is something we, as devotees, have been hoping for all this while. At least, the government gives us some appreciation in this way (of tax exemption),” she said.

Under Budget 2012, the government will expedite tax exemption approvals for all places of worship as well as educational institutions, including registered national, national-type, mission and government-assisted religious schools.

There are at least six categories of places of worship in Malaysia — Buddhist temples, churches, Gurdwaras, Hindu temples, mosques and Taoist temples.

Tan Hoe Choew, president of the Malaysian Consultative Council on Buddhism, Christianity, Hinduism, Sikhism and Taoism, said the tax exemption would encourage more devotees, especially from among the non-Muslims, to contribute to places of worship.

“All this while, there was no tax exemption. Now, when someone donates an amount towards the building of a place of worship, like RM10,000 to a temple, the temple’s committee can issue a receipt that would enable the contributor to claim exemption in their annual tax returns. It’s very good,” he told Bernama in an interview.

“Previously, the tax exemption was given on a case-by-case basis as the committee had to apply to the Ministry of Finance for the tax exemption. However, with the latest move, it would be a blanket approval,” he said.

Meanwhile, Council of Churches Malaysia president Rev Dr Thomas Philips had reportedly said that the tax exemption has been on the wishlist of Christians for a long time and he was glad that now they were entitled to some tax deduction.

Those who pay zakat (Islamic tithe) have always gotten tax exemption and it is good for the government to recognise that Christians also raise their own money, he said. – Bernama

Now, he said, churches should work out a system on how to issue receipts to their members. — Bernama

Currently, financial contributions to approved institutions or organisations which have been granted tax-exempt status are given tax deduction.

Budget 2012 has extended the tax-exempt status facility to all registered places of worship.

He said extending the tax-exempt status would encourage devotees to contribute to the building of new places of worship, their extension, upgrading of facilities, maintenance or to organise activities for devotees.

“It would help bring in more donations from the devotees. Its definitely a welcome move,” he said.

Malaysia Hindu Sangam (MHS) president RS Mohan Shan said the tax exemption was really a welcome move as all the Hindu temples were run on a charity basis and depended heavily on donations from devotees.

“We have more than 2,000 temples registered with us. By giving the tax exemption, more devotees can donate to ensure that these temples are well kept and running,” he said, adding that much of the contribution was not for building funds but for maintenance and to organise activities for devotees.

He said MHS has been educating the temple managements to carry out more community service projects instead of building bigger temples so as to avert the problem of having insufficient funds for maintenance.

Mohan Shan said he hoped that the Inland Revenue Board (IRB) could come out with clear rules and regulations on the tax exemption move and brief the temple committees and devotees and, at the same time, assist on how to certify the donation for tax exemption.

Tan of MCCBCHST, who is also president of the Federation of Taoist Associations of Malaysia, said MCCBCHST was looking forward to a dialogue with the IRB.

He said the tax exemption for donations to houses of worship was a big step forward in respecting the practice of other religions, but it should not be misconstrued as a blanket approval for the building of more unregistered places of worship.

“The building of new places of worship will still need to fulfill all existing guidelines,” he said.

Meanwhile, Council of Churches Malaysia president Rev Dr Thomas Philips had reportedly said that the tax exemption has been on the wishlist of Christians for a long time and he was glad that now they were entitled to some tax deduction.

Those who pay zakat (Islamic tithe) have always gotten tax exemption and it is good for the government to recognise that Christians also raise their own money, he said.

Now, he said, churches should work out a system on how to issue receipts to their members. — Bernama

Print Friendly

We encourage commenting on our stories to give readers a chance to express their opinions; please refrain from vulgar language, insidious, seditious or slanderous remarks. While the comments here reflect the views of the readers, they are not necessarily that of Borneo Post Online. Borneo Post Online reserves the right not to publish or to remove comments that are offensive or volatile. Please read the Commenting Rules.

Comments are closed.