KUALA LUMPUR: The Inland Revenue Board of Malaysia (IRBM) will raise the level of awareness among taxpayers and boost compliance rate among them in order to achieve a collection target of RM134.7 billion this year.
It chief executive officer Datuk Seri Sabin Samitah said in 2017, tax collection rose by 8.15 per cent compared to the previous year.
“This positive improvement clearly illustrates the overall strategy of 2017 has been well-planned and implemented to bring the desired impact and effect,” he told reporters at a meeting over afternoon tea here yesterday.
In addition to the strategy, he said, the main driver of this positive improvement was Malaysia’s encouraging economic growth last year.
“Income tax is the largest component of the country’s revenue, contributing around 50-55 per cent annually, to finance the nation’s development policy and the continuity of the people’s well-being. Therefore, the board will make every effort to plug loopholes so that taxpayers cannot escape from paying the taxes and this will help improve the rate of compliance,” said Sabihin.
He said this year, the IRBM would target special sectors like banking, insurance and finance to ensure their compliance rates were high.
“The tax leakage from the transfer pricing activities and the ‘underground economy’ practised by multinational companies will be our focus to ensure the on-going strategy to ensure their compliance was followed,” he said.
Sabihin said the board would aggressively adopt the strategy to ensure compliance among companies involved in tax planning.
“Among the methods detected used by these aggressive taxpayers included mergers and acquisitions of companies and the manipulation of the Labuan Business Companies Act 1990.”
Sabin said to-date, the IRB has detected nearly 50 local and multinational companies operating in Labuan involved in tax evasion. — Bernama