In Malaysia, the Government is reportedly considering reintroducing goods and services tax.
Sales and Service Tax has applied in the country since September 1, 2018. It replaced the six percent goods and services tax – a VAT – which was effectively repealed when the rate was reduced to zero percent from June 1, 2018.
The state news agency reported that the possibility of reinstalling GST had been discussed in comments made by the Finance Minister to Maybank IB Research. The minister reportedly also discussed the potential to raise revenues through a carbon tax or digital tax, or by reining in tax breaks.
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Malaysia has set out its plans for new tax incentives in its 2020 Budget, which are intended to attract investment from multinationals and innovative firms. It also confirmed plans for a digital services tax from next year, and announced a new top personal income tax rate.
The Government revealed that it is undertaking a comprehensive revamp of its existing tax incentive framework, with new regimes to be in place from January 1, 2021. For instance, MYR1bn (USD238m) worth of incentives will be granted to large multinationals in high-tech, manufacturing, creative, or “new” industries. To qualify, companies would need to invest at least MYR5bn and create 150,000 jobs over five years. Further, the Government is to offer another MYR1bn in tax breaks to export-focused businesses.
Companies engaged in the electrical and electronics industry that will support Malaysia’s transition to 5G technology and other … Read More »
There are plenty of things in this life that can do us harm. One of them can be taxation. But not, as conventional wisdom might have it, because taxes are too high, and too difficult to work out. No, in the world of BEPS and uber-transparency, taxes become harmful when they are too low. Or, as the European Union’s Code of Conduct Group (Business Taxation), a body tasked with rooting out harmful tax regimes, puts it, when tax measures “unduly affect the location of business activity.” Which is quite ironic really, given that the mysterious and shadowy Code Group has itself been accused of operating in a less-than-transparent fashion.
However, despite the time and resources devoted to this matter, the war against harmful taxation has yet to be won. Although, if recent OECD figures are anything to go by, the final … Read More »