Do not impose capital gains tax, DAP tells govt

DAP will object to any plan by Putrajaya to impose capital gains tax in the country.

In a statement, its secretary-general Lim Guan Eng (above) stressed the government should be rescuing the people with financial aid during the economic recession, instead of the other way around.

This came after Deputy Finance Minister II Yamani Hafez Musa told  Parliament last month that the government will look into the idea of implementing the capital gains tax to increase government revenue.

"The government must realise that the country is facing a severe national crisis of the Covid-19 pandemic and the economic recession.

"During this critical juncture, the government should put utmost priority in rescuing the people with financial aid and not the other way round of wanting the people to rescue the government’s depleting revenues.

"Offering financial aid to save the lives and livelihoods of the people is the duty of the government and not impoverish the rakyat further by squeezing them with additional taxes," Lim said.

A capital gains tax is a tax on the profit realised on the sale of a non-inventory asset, such as property, stocks, and real estate, among others.

However, capital gains tax is not something new in Malaysia, which already has the real property gains tax (RPGT) imposed under the RPGT Act 1976.

Makes country less competitive

According to a Bernama report, Yamani had on Sept 22 said that Putrajaya is looking at a number of measures to increase government revenue, including a tax on stock investment proceeds.

He also reportedly told the Dewan Rakyat that the government is taking into account the views of stakeholders on the proposal to implement capital gains tax.

Lim said: "DAP objects to any proposed implementation of a capital gains tax, including gains on shares, by the federal government to help rescue the government to replenish its revenues.

"DAP will oppose the government imposing a capital gains tax to increase its revenue. Such a capital gains tax would also cover inheritance tax."

According to the former finance minister, capital gains tax and inheritance tax were proposed during his time in office, but he had rejected them.

Lim said the tax would only make the country less competitive, with Malaysia recording one of the highest corporate tax rates amongst the 60 biggest economies of the world. - Mkini