Idiotic to sell Wisma MCA, says division chief

A MCA division chief said the sale of the MCA headquarters to Huaren Resources has not helped the party to avoid tax but instead incurred a 5% Real Property Gains Tax of RM5 million on the transaction.

KUALA LUMPUR: Wangsa Maju MCA division chief Yew Teong Look said today the sale of Wisma MCA to a party-owned firm in 2010 was “an idiotic move” that is neither tax-exempted nor transparent.

The MCA headquarters in Jalan Ampang was sold from party-owned Wisma MCA Sdn Bhd to Huaren Resources Sdn Bhd for RM136 million.

Huaren Resources has said the transaction will help the party avoid tax of RM750,000 a year through revenue received from rental of the building because the company is a trustee and nominee of MCA.

MCA, as a political party, is exempted from any tax. Huaren has said the sale was approved by the party’s central committee that year.

Yew said both Wisma MCA and Huaren Resources were limited companies so were not tax-exempted.

“If you transfer a property from a private company to another private company, it is not going to save tax.

“If you say Huaren Resources is a MCA trustee, so is Wisma MCA Sdn Bhd. So why is there a need to sell the property?” asked Yew, who is also the Safeguard Party Assets Action Committee chairman.

He said the transaction was subject to a 5% Real Property Gains Tax (RPGT) amounting to RM5 million because the building was initially valued at RM39.4 million, which translated to a gain of RM96.6 million when the building was sold.

“The one who did this is an idiot. You have to pay RM5 million the moment you sell the building and you cannot avoid any tax,” Yew told reporters here today.

He said it was even puzzling that the building was not listed in Huaren Resources’ account last year but only recorded as assets worth RM80,800.

He added that all these were stated in the auditors’ report of Huaren Resources last year.

“Wisma MCA Sdn Bhd has recorded the sale of the building in its account, but not Huaren Resources. So where has the building gone?” he asked.

He further questioned the annual directors’ allowance received by 10-man Huaren Resources’ board of directors amounted to RM369,000.

MCA treasurer-general Tan Chai Ho is the board chairman and many of the members were believed to be Chua’s supporters.

Yew said the MCA leadership should come clean on the matter and he would decide later whether to lodge a complaint with the Malaysia Anti-Corruption Commission (MACC).