Govt must clarify new taxes and their structure

the new taxes to be introduced will be specifically for a target group and reflect an income derived from a business venture, for example, profit instead of consumption-based approach.

We have been struggling with the rising cost of living since the implementation of the Goods and Services Tax in 2014 and hope the new taxes will not impact us greatly.

The government should reconsider the business model and economic structure before introducing new taxes.

I’ve observed that Malaysia is moving towards, among others:

sales either through Facebook and other social media platforms or apps. Surely, in the long term, this will dampen sales of retail outlets and affect the employment rate. Hence, the government should introduce digital tax on sales made through social media platforms;

and environment tax. I think applying a standard corporate tax rate is not reflective. Tax is imposed as a result of profit but it should reflect the impact it has on the business and economy. For example, let’s say the plastic industries employ 10 workers and generate a profit of RM500,000 per annum, but the negative social impact it creates to the environment, such as wastage and health issues, are not justifiable by merely paying a 20 per cent tax;

wealth tax — those owning more than 10 properties or have a net worth of at least RM10 million should be subjected to “super wealth tax”.

Income tax rate is derived based on employment income and not passive income;

strongly against, and speculate that the Finance Ministry will never impose capital gains tax on shares trading. This is because shares trading covers a wider scope and sometimes involves retirees and pensioners who trade in small volume through remisiers.

At this moment, Malaysia is not ready for capital gains tax; and

banking industry makes billions and is moving towards online transactions.

Meaning, the real impact on employment is no longer great, where they are not employing a sizeable work force, but talented people or those with skills.

Also, banking sectors are enjoying significant increase in the non-interest income segment which do not reflect risk and reward taken.

Net profit should reflect risk and reward taken by an entrepreneur. However, non-interest income reflects services undertaken by the bank in exchange for money. Hence, banking sectors should pay a higher corporate tax on non-interest income.

The government should clarify what the new taxes are and their structure and get feedback from the people.