No compromise on taxing ultra-rich, says Anwar

PARLIAMENT | There will be no compromise on ensuring that the ultra-rich pay their taxes, said Prime Minister Anwar Ibrahim.

Apart from introducing the capital gains tax and luxury goods tax, Anwar said the government was taking strict measures to avoid leakage of tax payments.

“We cannot compromise. It has to be ensured that the ultra-rich also pay their taxes and do not siphon their money abroad.

“I do not care if it’s old or new, if you cheat or bribe or steal the country’s money, pay it back,” he told the Dewan Rakyat.

Anwar (Pakatan Harapan-Tambun) was answering a question by Tanjung Karang MP Zulkafperi Hanapi who asked if the goods and services Tax (GST) will be implemented, and if so, when.

Prime Minister Anwar Ibrahim

However, Anwar responded that the country was not ready to implement GST due to low-income levels.

“I have said from the beginning that GST is an efficient and transparent taxation system.

“However, we are not ready (to implement it) as the rakyat’s income levels are still low.

“I don’t think that it (GST) can be considered within six months or a year,” said Anwar, who is also finance minister.

Fiscal deficit

Anwar introduced the luxury goods tax during the tabling of this year's national budget on Feb 24, a part of the government’s progressive efforts to tax those who are well off.

The rate for the luxury goods tax was not disclosed, but Anwar said there would be a ceiling based on the type of goods such as luxury watches and fashion items.

The capital gains tax, on the other hand, is imposed on the sale of unlisted shares by companies starting next year.

Earlier, Anwar also explained several ways that the government intends to reduce its fiscal deficit from 5.6 percent in 2022 to 3.2 percent in 2025.

He said the fiscal deficit for this year is expected to reduce due to a reduction in Covid-19-related expenses.

Anwar added that a one-off payment of US$3 billion (RM13.5 billion) for 1MDB bond repayment this year will result in the country’s fiscal deficit reducing to four percent next year.

Achieving a 3.2 percent fiscal deficit in 2025, he said, would be through the implementation of tenders instead of negotiations for projects, as well as targeted subsidies. - Mkini