MESTI BACA : OXYGEN FOR THE FREELOADERS AND PIRATES. POLICY MAKERS ALSO MUST READ.

 The heat wave is still upon us. My friends tell me that in Penang and Kedah it is even warmer. Back in 1978 (45 years ago) when I was at the Penang Free School it was also the same heat waves then. Nothing has changed. The globe was warm then too. It is seasonal. 

The heat wave could be quite unbearable. I recall the City Council buses in Penang (which I rode back from school) had that window in the roof and at my six feet height I could stick my head slightly through the window to get some air. The global warming was slightly cooler through that roof window in the City Council buses.

This was the old British Leyland bus used by the Penang City Council in the 1970s. You can see the two open windows on the roof of the bus. Nostalgia betul. 

But greenery does help to cool the temperature.  Below here is part of our yard in Beranang. We are still surrounded by green. Not surprisingly despite the heat wave there is heavy rain. This is hujan pemeluwapan (exothermal rain??)  where the heat in the day evaporates water vapour which then precipitates as rain in the evening and night when the temperature cools. When it rains it cools things down. Miss Chan my physical geography teacher taught me this in 1976 (47 years ago at the Melaka High School). Since Nature put things in place, we have had hujan pemeluwapan around this time of year. It is unique to our equatorial climes. Nothing to do with global warming.

Enough about the weather.   Thank you to the LHDN (Lembaga Hasil Dalam Negeri) which released a trove of information about tax collections yesterday. This is the type of information that must be shared with the public on a regular basis to educate the public. And in our country which has an army of freeloaders and pirates it is important that they too understand where their free pocket money is coming from. It is not an endless supply. Tax collections is very limited. First the news:

• T20 contributed 85% of personal income tax in 2022 says LHDN
• Corporate tax RM97.94b or 55% of overall tax revenue in 2022 
• RM39.26b personal income taxes 19% of overall tax revenue of RM175b
• T20 contributed 85% (RM33.68b) of 2022 personal income taxes
• total RM39.26b personal income tax in 2022
• M40 contributed 13% (RM5.38b) personal income tax in 2022
• remaining 2% from miscellaneous categories
• 2022 personal income tax RM39.26b was 19% of record RM175.4b collected
• Corporate tax contributed RM97.94b or 55% of overall tax revenue 2022
• remaining 26% overall tax revenue (RM37.8b) billion from RPGT, stamp duties
• Budget 2023 aims to reduce taxes for M40 
• increase taxes for 150,000 T20 taxpayers
• 2% decrease for M40 (RM35k to RM100k) benefit 2.4m taxpayers
• RM5b tax exemptions to boost economic activities
• LHDN on track to hit RM176.1b  tax collection target in 2023 
• so far in 2023 LHDN collected more in taxes than this time last year

My Comments :

So total tax collected (ALL TAXES) in 2022 was RM174.5 BILLION. A record.

First of all to the Lembaga Hasil Dalam Negeri or LHDN please publish a very big thank you to all Malaysian taxpayers. Jangan kurang asam ok. 

Secondly the tax collected does not belong to the LHDN. That is our money. The taxpayers money. We work hard so that we can earn money to buy food for the family, to pay all our bills and also to pay the taxes.  Please keep that in mind.

Thirdly the LHDN may want to ponder (just ponder) changing your name to Lembaga Pick Pocket Negara or LPPN. Because this is what you are doing. You are picking the peoples' pocket of their money. The only difference is you do it legally, according to the law. But for the people the effect is the same - money is forcefully taken away from us. 

Maybe the name "Lembaga Pick Pocket Negara" will help you understand your work better and help you appreciate and respect the taxpayers better.

I have never heard the LHDN say thank you even once to the Malaysian taxpayers for all the taxes that we pay.  Kurang asam betul.  Please include a big THANK YOU to all the hardworking Malaysian taxpayers in your annual report or in your Press Release or whatever.  

Ok lets look at the numbers a little. First Budget 2023 in a snapshot:

"In the revised Budget 2023, there will be an allocation of RM388.1 billion, which includes RM289. 1 billion for operating expenditure, RM99 billion for development expenditure, and RM2 billion for contingency savings."

Ok folks, dengar baik-baik ya:

• Total tax revenue in 2022 was RM174.5 Billion. 
• Budget 2023 was around RM388 billion. 
• That is a shortfall of 55% !! 

The taxes collected are only 45% of the 2023 Budget. Jangan main-main tau.

Even for 2023 the total tax collection is expected to be RM176b (a record). That is still insufficient.

The biggest tax contributors are the corporations, the companies. This will include the hundreds of thousands of SMEs, the Sdn Bhds, your friendly supermarket around the corner, the listed companies, the factories, the electronics factories etc. 

I would include the GLCs but they are full of crap. Plus they are not real businesses. They are monopolies, oligopolies and they survive by sucking money from that RM174 billion tax collections. 

Corporate taxes contributed RM98 billion or 55% of all taxes collected.

So here is a soalan cepu mas : Should the gomen's policies (dasar-dasar kerajaan) choke, strangle and kill off the corporations or should the dasar-dasar kerajaan help the corporations increase their operations, increase their businesses, increase their sales and generate more profit so that they can pay more taxes?

Please bear in mind - the total tax collectionn in Malaysia was only RM174 billion in 2022 but the Federal Budget 2023 was RM388 Billion. Duit tak cukup. Tax collection covers only 45% of the gomen's Budget. We are in deep shit.

The T20 contributed RM34 billion or 85% of total PERSONAL income taxes. 

RM34 billion is also about 20% of the total tax collection of RM174 billion in 2022.

So the same question applies. Should the dasar-dasar kerajaan choke, strangle and kill off the golongan T20 so that they die off and cannot pay any more taxes? 

If the dasar-dasar kerajaan choke, strangle and kill off the corporations then how is the LHDN going to 'pick the peoples' pocket' to get RM98 Billion in corporate taxes?

Duit hangpa nak beli Mercedes dan Alphard nak mai dari mana? 

If the dasar-dasar kerajaan choke, strangle and kill off the T20 then how is the LHDN going to 'pick the peoples' pocket' to get RM34 Billion from the T20 groups' personal income taxes?

When you increase the electricity tariff for the corporations (the MV and Hv users) you are making life more difficult for them.

When you increase taxes for the T20 (but give a discount for the M40) you are making life more difficult for the T20. How are they going to keep paying that RM34 billion personal income tax every year? 

The corporations and the T20s work hard. Otherwise they will NOT be able to become T20 or to pay so much taxes. Why do you penalise them for working hard? Why do you penalise them when they are paying so much taxes? Otak hangpa dekat lutut ke?

You want to give free money to this golongan, you want to give freebies to that kaum its ok. Fine. Very, very good. But why do you want to punish the T20 and the corporations that generate so much tax revenues which allow you to give free money to this golongan and to give freebies to that kaum?

Let me ask you again and please think extremely very carefully before you answer this question : otak hangpa dekat lutut ke?

The Budget is RM388 billion. The tax revenue is only RM174 billion or 45% only. Less than half. Memang tak cukup.

Common sense says cut your spending. 

Sudah telan RM6 billion for the invisible LCS now they want to spend another RM11.2 billion for the same LCS. That is RM17.2 billion in total. Chairman boleh kahwin bini tiga dah.

Where is the money going to come from? You can pull out money from your bontot-kah?

You can issue MGS (Malaysian Gomen Securities)? 

Khazanah Nasional Bhd has just borrowed another RM7.0 Billion. Banyak cantik. Pinjam, pinjam, pinjam.

How many years and years will it take for us to pay off this hutang? Our great grandchildren will be paying off all this hutang. Is that what you call clever management of the economy?

We need to collect taxes. That is a certainty. If we dont collect taxes we will disappear from the face of the earth.

But before we can collect taxes, our people (not the LHDN) must be able to generate taxable income. Mesti ada sales, revenue, untung, profit. Baru boleh bayar cukai.

Before the people can generate taxable income the dasar-dasar gomen must be in place which encourages, supports, promotes and makes things easier for the people to pursue economic opportunities, to create new businesses, to expand existing businesses, to generate more production, more output, generate more sales and more revenues. 

Make things easier for them by lowering the costs of doing business, lowering the costs of labour and manpower, lower the costs of paying for raw materials (no monopolies), cheaper tariffs for power, water, telephone, online data (no monopolies, no APs, no unnecessary licensing and regulations). 

Only then will they expand their businesses, make more sales, generate more profits and then pay more taxes. 

Kun Pa Yakun (be and it is!) does not work. Ini bukan wayang P Ramlee lah.

Get serious. Grow up. Jangan main-main.

Hello LHDN, jangan lupa ok.  Say thank you to the Malaysian taxpayers. 

If there are no taxpayers you will not have a job. 

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.