Thursday, June 27

Finance Ministry studying proposal to tax tech giants

0

KUALA LUMPUR: The Ministry of Finance is conducting a detailed study on the proposed taxation on giant technology companies and social media such as Google and Facebook.

Second Finance Minister Datuk Seri Johari Abdul Ghani said the matter was out of necessity, as well as to seek the best taxation mechanism and model.

“It is also aimed at monitoring the comprehensive review of online business taxation being made by the Organisation for Economic Cooperation and Development,” he said when winding up debate on the motion of thanks for the Yang di-Pertuan Agong’s royal address for his ministry at the Dewan Rakyat here yesterday.

A suggestion was made that tax should be levied on giant technology and media companies such as Google and Facebook as both were said to control almost 70 per cent of digital advertising expenditure in Malaysia.

The proposal was mooted during a luncheon talk between Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi and media editors and publication permit holders at the Putrajaya International Convention Centre here recently.

Meanwhile, Johari dismissed the notion that the people did not feel the country’s economic growth, describing it as inaccurate, as benefits like rising salaries, employment  opportunities and overseas spending proved otherwise. He said based on the Department of Statistics data in 2017, salaries in the services sector increased by 5.4 per cent while that of the manufacturing sector, 8.6 per cent.

“In terms of employment, if the economy does not grow, we will not be able to create more jobs and over the past three years, the government recorded an increase of 1.1 million jobs,” he said.

He said the people’s spending abroad rose to RM46 billion, while retail outlets increased from 66,000 to 73,000 units in 2017, attesting the positive impact of economic growth on the people.

“We do not deny that some of people are left behind in the country’s development, but this is the role of the government in providing specific assistance to the people in need,” he said.

On the national debt, Johari said the total amount as at the end of December 2017 was RM686.8 billion or 50.8 per cent, which was below 55 per cent of Gross Domestic Product.

In another development, he said 90,599 people contributed under the 1Malaysia Retirement Savings Scheme (SP1M) as at December 2017, with 17,298 of them housewives.

“Currently, housewives can choose to contribute voluntarily under SP1M with a minimum contribution of RM50 and a maximum of RM60,000 a year,” he said.

He said SP1M contributors could also enjoy the government’s contribution of 15 per cent in the scheme, subject to a maximum of RM250 per year. — Bernama