ANN/THE STAR – While acknowledging that taxes are needed for the development of the nation, the Malaysian Prime Minister said his administration will take a “tax only when necessary” approach when it comes to taxation policies and reforms.
“The changes that we will have to make, including in the forthcoming budget, will be based on these sound principles,” said Anwar Ibrahim in his keynote address at the opening of the National Tax Conference 2023. “Tax only when necessary and it should never be seen as a burden to the public and the business community.”
He said that such an approach would encourage nation-building productivity while ensuring the welfare of the marginalised.
The nation’s taxation system, he added, must also allow both local and foreign businesses to thrive, while instilling a sense of belonging and responsibility consistent with the Madani concept.
“I look forward to engage with the Inland Revenue Board (LHDN) on their suggestions on how to effectively undertake or adjust policies or introduce new ones.
“Good governance is crucial to rid the country of endemic corruption, which has an impact on taxation revenue.
“LHDN has a major responsibility to ensure government finances remain sound and that they are not abused, spent on luxury items or taken for granted by leaders who hold office.
“We have seen this from the past, where positions of power are used to amass personal wealth or to enrich families or cronies,” he added.
Anwar also said collecting taxes would be pointless if there were leakages. “We can collect as much as possible, but if governance issues are not resolved, there will be leaks. You can spend MYR22 billion to help the rakyat, but if there are leaks of MYR5 billion to MYR6 billion, things will go haywire.
“We can approve contracts for flood mitigation, Jana Wibawa and whatever, but funds will get siphoned off,” he said. As such, he said, tax institutions must be very efficient, clear and effective.
In November last year, the Malaysian Anti-Corruption Commission said it would look into reports concerning a flood mitigation project that was allegedly approved after the dissolution of Parliament under the previous administration.
In February, when announcing Budget 2023, Anwar said six flood mitigation projects were to be re-tendered, saving the government some MYR2 billion from the estimated MYR15 billion allocated for the projects previously. Anwar also announced then that Jana Wibawa projects worth MYR7 billion awarded through direct negotiations would be scrapped.
