IRB cannot reveal info of tax payers because of tax and privacy laws

The Inland Revenue Board of Malaysia (IRB) may have been shadowy in the past, but the Pakatan Harapan government is committed to "shine the light" on all its procedures and processes, said Finance Minister Lim Guan Eng.

Lim said the tax department wants to be as transparent as possible, but at the same time it cannot divulge personal information of tax payers.

"I know you want to know information of certain political leaders, but we cannot do that as it is confidential.

"As much as we want to recover all the taxes owed to the country, we cannot divulge personal information," Lim told a press conference at the 40th Commonwealth Annual Tax Administrators Technical Conference in George Town today.

He was responding to a question regarding the challenges in obtaining and verifying information from the tax department.

Earlier, Lim (above) spoke about the "shadow economy" during his opening speech, where he said, among others, that such phenomena is difficult to measure due to its underground nature.

However, Lim said various studies have shown the size of the shadow economy ranges from 15 percent of the country's GDP in rich countries, to about six percent in less developing countries.

"In Malaysia, the figure is expected to be about 21 percent of the GDP," Lim said.

With the economy at RM2.45 trillion at the end of the 2018, Malaysian shadow economy is about RM300 billion.

"If we could only integrate even a fifth of the shadow economy into the formal sector, this could bring about RM5 billion to RM15 billion worth of additional revenue to the government," he stressed.

Lim said politicians publicly declare their assets to avoid violating any laws, but for tax information, confidentiality is everything.

He added, if such information is not protected, tax laws, as well as data protection regulations and privacy laws, will be violated.

The shadow economy includes all economic activities, including corruption, hidden from authorities for monetary, regulatory and institutional reasons. - Mkini