Lim Guan Eng
KUALA LUMPUR: The government does not intend to introduce a wealth tax to avoid shocks to the capital and finance markets, says Finance Minister Lim Guan Eng.
He said the government was in the process of reviving the country’s fiscal deficit and any new taxes of this sort, including the capital gains tax, could be detrimental to efforts.
To recap, the Finance Minister has established the Tax Reform Commission to study the taxes to be implemented under the 2019 Budget.
Elaborating further, Lim said the wealth tax was not considered after feedback from several parties, including Bank Negara Malaysia, the Securities Commission and the Finance Ministry.
“This followed concerns that the returns from the tax to the government will not commensurate with the negative impact towards the capital market and the (country’s) financial position.
“Therefore, if this step is taken under the current challenging fiscal situation, it will also be a shock to the capital and finance markets,” he added, when responding to a supplementary question from Hassan Abdul Karim (PH-Pasir Gudang) and Datuk Seri Ronald Kiandee (BN-Beluran) in the Dewan Rakyat ysterday.
He said none of the neighbouring countries had introduced this type of tax.
“I think what we need to do now is not to be too eager, to the point of creating a systemic shock.
“The government is aiming to revive Malaysia’s fiscal and financial position in three years, which will then put Malaysia back on track,” he added. — Bernama