Telco, construction firms among tax dodgers

By Jonathan Edward
Datuk Sabin Samitah (left) warned tax dodgers would be exposed and dragged to court if they failed to pay up within a month. ― Bernama pic

KUALA LUMPUR, April 13 — The Inland Revenue Board (IRB) is set to come down hard on 20 large companies that owe the government RM1.4 billion in taxes.

The board’s chief executive officer, Datuk Sabin Samitah, warned the dodgers would be exposed and dragged to court if they failed to pay up within a month.

In another shocking revelation, Sabin said IRB had identified over 2,500 business entities and individuals who had evaded paying taxes since the launch of Operasi Gegar Bersepadu three days ago.

“The companies in question are from the telecommunications, plantation and construction industries. If they refuse to settle their outstanding taxes, we will take them to court and their names will be revealed,” he said.

Sabin said there were 30 companies that had earlier failed to pay RM2.2 billion in taxes but 10 of them had settled RM800 million after receiving notices from IRB.

“These companies have cost the government a loss in revenue and it is our responsibility to recover the money,” he said.

The board had launched a series of operations since Monday, zeroing in on corporations including government-linked companies and “underground businesses” largely centred in Bukit Bintang and Bangsar.

“There is poor bookkeeping in these areas, making them a gold mine for unregulated businesses,” Sabin said.

“Enforcement operations in Bukit Bintang and Bangsar will raise awareness, showing the masses our seriousness in nabbing tax dodgers.”

Massage parlours line up Jalan Bukit Bintang while Bangsar sees a large number of illegal vendors operating.

IRB personnel would visit these establishments and conduct business census, audit their accounts and scrutinise the monthly tax deductions of these businesses.

Sabin said Operasi Gegar Bersepadu got off to a flying start with 2,588 cases — 1,830 individuals and 758 companies — of tax evasion identified in just three days.

He said tax dodgers would be slapped with stiffer penalties under the Income Tax Act 1967 starting next year to improve compliance with the national tax regime.

“We have been charging a rate of 45 per cent to the amount owed in taxes but the Act allows us to charge up to 100 per cent,” he said.

“We will review our current practice and put in place a higher rate next year.”

Sabin said IRB targeted revenue of RM127 billion this year and RM36.26 million in tax arrears derived from individuals.