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Tuesday, August 13, 2019

Gov't: Najib must pay RM1.69b in taxes despite reassessment appeal


Najib Abdul Razak must still pay RM1.69 billion in tax despite the former prime minister having filed a reassessment appeal with the Inland Revenue Board (IRB), contended the government.
This was stated in an affidavit in support of an application for summary judgment of the suit, which concerns income tax owed by the ex-premier.
The application was filed by IRB on behalf of the government at the Kuala Lumpur Courts Complex on Aug 8.

Under Malaysia's civil law, summary judgment is a mode of disposing of legal action without going for a full trial, in very clear cases where the defendant has no defence against the claim.
According to a copy of the affidavit signed by IRB's Monitoring Unit assistant director Hisyamuddin Mohd Hassan and sighted by Malaysiakini, a person appealing with the board against the assessment must still pay the computed tax due, per Section 103 of the Income Tax Act 1967.
Hisyamuddin also contended that Najib, who was also former finance minister, lacked any defence with merit against the lawsuit to recover RM1,692,872,924.83 for the years of assessment between 2011 and 2017.
According to the affidavit, Najib filed his reassessment appeal on April 16. It was received by the plaintiff two days later.
The document stated that the assessment notices were properly served on Najib on March 25.
"I, therefore, reiterate that under Section 103 of the act, a tax assessed on somebody is due on its due date and has to be paid when the assessment notices were served, regardless of whether the person is appealing against the assessment or not," Hisyamuddin said.
"Furthermore, I have been advised and believe that the defendant (Najib) has no defence with merit in this claim, and that the plaintiff (the government) has the right to obtain the relief sought."
Hisyamuddin added that pursuant to the government's right to initiate suit to recover tax arrears under Section 106(3) of the act, the court need not entertain any plea by Najib that the tax amount was excessive, incorrectly assessed, still under appeal, or was increased incorrectly.
Under the summary judgment application made under Order 14 of the Rules of Court 2012, the government seeks not only RM1.69 billion, but also annual interest of five percent on the sum from the date of judgment until the date of realisation, cost, and any other relief deemed fit by the court.
According to the online cause list at kehakiman.gov.my, the suit will come up for case management before Kuala Lumpur High Court judge Ahmad Bache.
The online listing showed that the case management is related to Najib’s application for an interim stay of the proceedings.
On Aug 8, Najib had filed an application to stay the proceedings pending his tax-reassessment appeal with IRB.
The former premier had claimed that he had a high chance of winning the appeal to have his taxes reassessed, because donations allegedly formed a large portion of the funds from which the RM1.69 billion tax sum was calculated.
The government through IRB initially filed the suit against Najib on June 25. 
It sought over RM1.69 billion from the former premier, with an annual five percent interest rate beginning from the date of judgment, as well as cost and other relief deemed fit by the court.
In its statement of claim, the government said, Najib had failed to pay his income taxes for 2011 to 2017 within the stipulated 30-day period after assessment notices were issued.
As such, the amount owed each year was increased by 10 percent.
It also said that Najib was given 60 days to pay the taxes, together with the 10 percent increase, but still failed to do so.
Following this, Najib was slapped with another five percent increase in the 10 percent hike, bringing the total amount of income tax due to RM1,692,872,924.83.
The final amount owed each year is as follows:
  • 2011: RM134,180,247.10
  • 2012: RM370,674,071.81
  • 2013: RM1,029,767,352.60
  • 2014: RM137,612,077.11
  • 2015: RM19,495,822.53
  • 2016: RM743,179.21
  • 2017: RM400,174.47

-Mkini

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