Tax evasion in Malaysia will slowly move from civil to criminal alone can’t more

Published: Wednesday October 3, 2012
Criminal action against more tax evaders next year as IRB gets tougher


Move is to send a strong message to errant taxpayers, says IRB CEO

KUALA LUMPUR: The Inland Revenue Board (IRB) will go all out to catch tax evaders next year by enforcing criminal action against them. In a move to send a “strong message to errant taxpayers” the IRB said it will be launching criminal investigation against more defaulters, in addition to its civil action. Tax evaders can face up to three years in jail or RM20,000 fine or both if found guilty for the various offences under the Income Tax Act 1967, Evidence Act 1950, and the Criminal Procedure Code.

IRB CEO Tan Sri Dr Mohd Shukor Mahfar said the action against tax evaders would be its primary focus next year.”While we have always had the provisions under the law to take criminal action against tax evaders, we have not been enforcing it,” he said during a press conference at the National Tax Seminar here on Wednesday. Apart from 69 criminal cases initiated by the IRB since 2004, the IRB has been taking only civil action against tax evaders.

“However, we have found that the civil action does not deter them from becoming repeat offenders. “The amount of money involved is a secondary consideration. The main issue to address is the criminal intention to avoid paying their dues,” he told reporters. He said the move was a step forward in encouraging taxpayers to pay their dues and that many other countries were already implementing similar measures.

“The burden of proof is on us to prove that the individual or company had the intention to avoid paying its dues. “Of course, we will look at the individual or company’s track record before deciding whether to take further action against them,” he said, adding that only those who were found to have clearly contravened the laws would be charged. Dr Mohd Shukor said about 20% of Malaysian taxpayers failed to submit their return forms to the IRB each year.

Source: The Star

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