Voluntary income declaration a goodwill gesture from PH, says Chong

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Chong holds up the LHDN letter that requests taxpayers to voluntarily disclose their income.

KUCHING: The Inland Revenue Board (LHDN) letter of notice to tax payers on the voluntary declaration special scheme of income is just a gesture of goodwill by the Pakatan Harapan (PH) government, clarifies Deputy Minister of Domestic Trade and Consumer Affairs Chong Chieng Jen.

He explained that the letter was issued because there is a special offer to those who had in the past under-declared their income or who had earned an income and take it overseas.

“Of late, many felt very disturbed and upset upon receiving the letter from LHDN requesting for voluntary declaration of income.

“But I would like to state here that the issuance is a gesture of goodwill by the PH government,” he told a press conference at Sarawak DAP headquarters here today.

Chong, who is Sarawak PH chairman, noted that under the old regime there was an agreement entered into among all the countries in Association of South East Asian Nation (Asean) for disclosure of bank information.

He said with the international agreement, the Common Report Standard (CRS) on the Automatic Exchange of Information (AEOI), all those accounts in the name of Malaysians in the foreign bank in foreign countries will be voluntarily disclosed to Bank Negera and vice-versa.

This agreement, he pointed out, was entered into two years ago and it will be executed soon.

CBS is a standard formulated by the Organisation for Economic Co-operation and Development (OECD) to implement the AEOI in relation to tax matters.

Chong said under the existing law of the country, for the under-declared income or revenue, they will be subject to the tax amount plus a 100 to 300 per cent penalty.

However, he said the new government had offered this special treatment to all those who have under-declared their income by offering them to take the voluntary disclosure special scheme on or before March 31, which requires them to pay the tax amount plus a 10 per cent penalty only.

He said for those who have declared voluntarily after March 31 and before June 30, they will be subject to the tax amount plus a 15 per cent penalty, which is still much lower than the top bracket income tax of 24 or 26 percent.

“Also, there will be no penalty incured for your under-declared income. This is a good gesture of the new government.

“We understand that under the old regime, many tax payers are reluctant to pay tax because they know their tax money will be used by the old regime for payment of debts like 1MDB, for corruptions and for a lot of wastage.

“But under the new regime, I can assure every tax payer that the tax money you pay will be used to the fullest of its worth,” he said.

Chong said for the many who have received the letters but has no income to declare, had in the past legitimately declared their income, they don’t have to be worried.

“If you have made your declaration, investigations over your income will stop; if you don’t need to pay because of your income level, which is below the threshold or if you have in the past declared your income lawfully, complying with the tax regulations, then there is no need to be upset or to be worried.

“You can get confirmation from your tax consultant, that’s it, and if there is no need for you to declare your income, just ignore the letter,” he concluded.