KOTA KINABALU: Parti Bersatu Sabah (PBS) is happy that Second Finance Minister Datuk Johari Abdul Ghani has pledged to issue an exemption order that will exempt all types of income of religious institutions registered with the Registrar of Societies, Malaysia or under any written laws regulating the institution, from tax.
Its secretary general Datuk Johnny Mositun said Johari’s decision should put to rest any fears that churches, temples and religious institutions in the country would have to start paying taxes.
“The confusion has been cleared up. It was all a misunderstanding that led to church leaders and temple committees fearing that their organizations would lose their tax-exempt status. We are relieved that it is not so,” Mositun said in a statement yesterday.
PBS, he said commends the Ministry of Finance for the clarification and reaffirmation that religious bodies are tax exempted adding, “this is consistent with PBS’ and Barisan Nasional’s stand.
In its last sitting, parliament passed an amendment to the Income Tax Act 1967 that tightened the rules on tax exemption for non-government religious organizations in the country. Unlike mosques and most Islamic institutions which are government-owned, churches, temples and other places of worship are not.
State leaders in Sabah and Sarawak, states with large Christian populations, said they were not prepared to accept the amendment if it discriminated against non-Islamic institutions.
Last week Sabah Chief Minister Datuk Seri Musa Aman, his Deputy and PBS president Tan Sri Joseph Pairin and PBS acting president Datuk Seri Dr Maximus Ongkili among others, called for a full explanation from Putrajaya about the amendment.
Prime Minister Dato’ Sri Najib Tun Razak had promised to bring up the matter in last week’s Cabinet Meeting.
“The Prime Minister has kept his word. The Second Finance Minister Datuk Johari had a meeting with representatives of religious institutions on 9 January, during which the matter was cleared up and the minister said he would be issuing the letter of exemption. So any fears that this amendment would victimize private religious institutions should no longer be entertained,” Mositun said.
He said the amendment to the Income Tax Act 1967 was actually aimed at protecting the religious institutions themselves from being exploited by individuals or groups that exploited their tax-exempt status for questionable reasons including fraud, theft, self-enrichment and, in extreme cases, to carry out undesirable and non-religious activities.
Mositun said Sabahans need not be apprehensive about the matter any more as both the state and federal governments would never pass a law that discriminated against its own citizens on the basis of religion nor did it intend to burden genuine religious institutions with taxes.