‘It doesn’t make any difference which system is used’

PUTRAJAYA: RM16 billion of unreturned tax remains missing from the Tax Refund Trust Fund (TBBC) whether the government uses the modified cash basis or the accrual accounting system, said Finance Minister Lim Guan Eng.

Responding to former prime minister Datuk Seri Najib Razak’s Facebook post, he said according to the Inland Revenue Board and verified by the Accountant General’s Department, which used the modified cash basis, the figure stood at RM16.046 billion as at May 31.

A total of 1.65 million individuals and companies had not received the amount owed to them since six years ago, Lim said yesterday.

On Saturday, Najib said on Facebook that Lim did not understand that the government used the modified cash accounting system and not the accrual accounting standards employed by the private sector.

Najib claimed that Lim had wrongly concluded that the Barisan Nasional-led government had misreported unreturned taxes as revenue and mistakenly accused it of falsifying accounts.

Lim said the missing monies were due to the failure of the Finance Ministry’s Cash Management Committee to transfer funds to TBBC.

“Pursuant to Section 111B(2) of the Income Tax Act 1967, only the finance minister has the power to make any decision to transfer funds to TBBC.”

Najib was also former finance minister.