Malaysia News: Malaysia’s Budget 2019 – Tax Highlights
Malaysia’s Budget 2019 – Tax Highlights
Malaysia’s Budget 2019 – Tax Highlights Budget 2019: ‘A Resurgent Malaysia, A Dynamic Economy, A Prosperous Society’
The first inaugural Budget of the new Pakatan Harapan government was announced by the Finance Minister, YB Lim Guan Eng, on 2 November 2018. The focus of this Budget centres upon implementing institutional reforms, ensuring socioeconomic well-being and fostering an entrepreneurial economy.
Given the level of government debt and a trend of continued budget deficit, the Budget strives to restore fiscal finances by implementing a number of policy changes and tax reform measures.
There are a number of key proposals. A Special Voluntary Disclosure Programme is proposed as a means of raising tax revenue. This programme allows taxpayers to declare any unreported income within a specified time frame and enjoy lower penalty rates of 10% or 15%. There is a proposal to limit the carry forward of losses and allowances to seven years. The government also seeks to raise taxes from the digital economy notably by imposing service tax on imported online digital services however enforcing this may prove to be a challenge since these service providers are located outside Malaysia.
The main proposals are summarised in the downloadable PDF file. Where required, Luther may provide further assistance to help analyse the potential impact of these changes on your business.
Pascal Brinkmann, LL.M. (Stellenbosch)