IRB recovered RM5.2b in tax evasion, under-declared income in 2023

THE Inland Revenue Board (IRB) has recovered RM5.2 bil in additional assessment tax raised due to unreported, under-declared, and evasion of reported income by individuals and companies in 2023.

“IRB will take measures under the provision of the Income Tax Act 1967 to combat tax evasion, including enhanced enforcement, legislation and taxpayer education.

“We are also committed to tackling tax evasion and at the same time, strengthening the tax net by broadening the tax base to address any existing leakages or gaps to make sure that everyone pays an equal share to the government without discriminating against either individuals or companies,” it said.

It also added that other measures taken to address tax evasion include the implementation of tax identification numbers (TIN) and e-invoices.

Two days ago, MCA voiced concerns over the recent issuance of the “e-Invoice Guideline (Version 2.1)” by the Inland Revenue Board (LHDN), particularly regarding its impact on micro, small, and medium-sized enterprises (MSMEs).

While e-invoices aim to simplify tax processes and enhance transparency, MCA emphasised the need for clarity in implementation to avoid burdening businesses.

Challenges highlighted include the need for IT transformations, increased financial costs, and concerns over security and tax data privacy.

Moreover, MCA warns against the potential risks of unauthorised access and misuse of sensitive information by hackers and scammers, which could lead to significant losses for businesses and individuals.

Last year, the government stated the initiatives to implement the TIN and e-invoices were aimed at addressing shadow economy activities.

The TIN will be assigned to Malaysians over the age of 18 as well as corporate entities to increase the number of registered taxpayers and reduce tax arbitrage activities.

The e-invoicing mechanism would require businesses to maintain a comprehensive record of their transactions and report fully to the IRB. – April 20, 2024

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