Impact of prosperity tax on banks manageable - Bank Negara

 

The impact of the proposed cukai makmur (prosperity tax) under the recently announced Budget 2022 is expected to be manageable on the banks, given that it is a one-off tax, said Bank Negara governor Nor Shamsiah Mohd Yunus.

“Although cukai makmur will lower the banks’ retained earnings for next year, their overall profitability is expected to remain, supported by improvements in loan growth as the country recovers from the prolonged effects of the pandemic.

“(It will also be supported by) the potentially lower levels of provisioning next year amid some improvements in the credit risk outlook,” she said in a joint press conference by Bank Negara and the Department of Statistics Malaysia (DOSM) on Malaysia’s third-quarter 2021 gross domestic product (GDP) performance in Kuala Lumpur on Friday.

Nor Shamsiah (above) was responding to a question on whether the proposed tax would lower the banks’ total net profit for the financial year 2022 and how would they prepare for this new tax.

When tabling Budget 2022, Finance Minister Tengku Zafrul Abdul Aziz announced that companies with earnings above the RM100 million mark would be taxed at a rate of 33 percent, instead of the blanket 24 percent rate previously.

The one-off tax was for the assessment year 2022, and is expected to have an impact on not more than 250 companies.

- Bernama