Sarawak sees smaller number of GST appeal cases

(From left) Koh is seen with Chandran, Tribunal member Suhairy, Ghafar, Indrasathi, Deloitte Malaysia senior tax managers Kane Hansel Bong, and Chai Suk Phin during a photo opt session after the GST Appeal Tribunal Workshop organised by Deloitte Malaysia.

KUCHING: The number of Goods and Services Tax (GST) appeal cases filed by Sarawakian companies is small thanks to the growing awareness amongst businesses and companies on its legislation and system.

Although the GST Appeal Tribunal did not announce an official number for the state, it noted that the number of cases from the state is small compared to a nationwide consensus whereby the number of appeal cases decreased from 588 in 2015 to 663 in 2016.

“Before this, most appellants do not realise that there are 17 matters that they cannot appeal on and the GST Appeal Tribunal has no jurisdiction to hear these cases against the Director General’s (DG) decision.

“In 2015 and 2016, we received a lot of these types cases. However, we foresee that the appeal for non-appealable matters will decline as now, most of the appeal cases now are eligible to be trialled,” the Tribunal told The Borneo Post following the GST Appeal Tribunal Workshop organised by Deloitte Malaysia.

The workshop was attended by the GST Appeal tribunal deputy chairman Abdul Ghafar Abdul Talif and tribunal member Indrasathi Muniandy who shared their knowledge and insight on the intricacies of the GST appeal and dispute resolution process.

GST & Customs director Chandran Ramasamy also shared his experience in the tribunal and educated the participants on the key aspects and nuances of the case management process.

Chandran, who leads the Deloitte team specialising in providing legal assistance, stressed that the GST Appeal Tribunal is an independent body that is part of the Ministry of Finance and not a part of Malaysian Customs and as such, the decisions are independent of Customs.

Taxpayers should expect a fair hearing on the disputed issues. Nonetheless, taxpayers ought to be aware of the issues that may not be appealable and it is important to understand this before incurring additional cost.

When asked on common appeal cases registered by companies in East Malaysia, the tribunal revealed that there were mainly on claiming of input tax credit (ITC).

“Companies such as the timber companies find that they are in a difficult situation in terms of claiming ITC because some of these companies do not have the proper export license. Instead, they use export licenses from another agent.

“These agents have to file their own company’s or business’ name under the K2 form (the exports declaration document) to export goods from Malaysia to overseas.

“Under this circumstance, the company using these agents, can not claim ITC for its taxable supplies. This type of cases is some of the common cases we are handling in East Malaysia, right now.

“This is more common in Sabah as there are a lot of timber companies there. While there is only one case in Sarawak, in terms of claiming ITC,” the Tribunal said.

Deloitte Malaysia Indirect Tax Clients & Markets leader Koh Siok Kiat also shared that many cases were rejected or lost as taxpayers were not prepared or equipped with knowledge of the GST law.

“A case not properly managed will diminish the opportunity to succeed. There are also some cases where the DG of Customs has not been successful and the Tribunal ruled in favour of the taxpayers.

“It is advisable for the taxpayers to acquire professional assistance to present the case appropriately. There could also be other alternative options to appeal such as internal reviews and mediation, before going on to the Tribunal,” he added.

Aside from that, Indrasathi’s shared on key procedures of the appeal process, while Ghafar also shared a total of six case decisions made by Tribunal, including few cases that ruled in favour of the appellants (taxpayers).

“We have already made a decision on these cases and we will publish it on our portal,” the Tribunal said.

Of note, the GST Appeal Tribunal will be launching an online portal in October 2017 and it will serve as an all-in-one platform for the Tribunal to announce its decision on cases, for appellants to register cases, and more.

Deloitte Malaysia Indirect Tax Clients & Markets leader Koh moderated the session covering the following topics such as the appeal filing process – timeline and procedures, appealable and non-appealable GST matters, common errors and observations in filing an appeal, recent decisions of the GST Tribunal: implications to businesses and industrial sector, issues and challenges: lessons learnt, and Strategy & and case planning (case management).

The seminar was attended by a full room of close to 50 participants across different industries.

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