The Unity Government is responsible for expanding revenue base, Anwar said and form next year, some taxation reform measures
will be implemented to expand the country’s revenue base, at the time same does not burden the majority of the people.
FIRST: The Government plans to raise the Tax rate on Services to 8 percent instead of 6 percent. However, in order does not burden the people, this increase does not included services such as food and beverages and telecommunications.
The government will also expand the scope of taxable services to include logistics, brokerage, underwriting and karaoke services.
SECOND: After taking into account the input of interested parties through engagement sessions held, the Government will enforce the implementation of Capital Gains Tax for the disposal of shares no listed by local companies based on net profit at a rate of 10 percent from March 1, 2024.
The government also considering the above Capital Gains Tax exemption disposal of shares related to certain activities such as Initial Public Approved Offering (IPO), internal and company structuring Venture capital is subject to set conditions.
THIRD: The government will enact new legislation for implementing High Value Goods Tax at a rate of 5 to 10 percent on certain high-value items such as jewellery and watches based on the item price threshold value.
Malaysia needs to keep pace with international taxation standards especially in curbing tax base erosion activities and the transfer of profits to a country that has a tax rate that low. Taking into account feedback from the industry and developments latest international, the Government is expected to implement taxes global minimum in 2025 and only applies to companies which has a global income of at least 750 million EURO.
The government will also continue to monitor the development of the minimum tax global at the international level.
Related to the implementation of e-invoicing by the Inland Revenue Board Malaysia (IRB), the Government takes into account the feedback received and to give enough time to taxpayers.
The government agreed to enforce e-invoicing mandatory to taxpayers with income or annual sales exceeding 100 million ringgit from 1 August 2024.
Whereas, taxpayers according to income category the rest will be made in phases with the implementation target comprehensive from July 1, 2025.
The use of Tax Identification Number (TIN) will be expanded to support the implementation of e-invoicing. This can expand further voluntary tax compliance follow-up taxpayer network which in turn reduces revenue leakage.
Enforcement agencies will continue to intensify joint efforts deal with revenue leakage. Cigarette smuggling control measures for example, has contributed to the decrease in the percentage of illegal cigarettes in the local market to 56.6 percent in 2022 instead of 63.8 percent in 2020. Given the number of illegal cigarettes still high in the market, cooperation between agencies will be enhanced including tighten the control of liquor smuggling.
