Malaysia – The Dewan Rakyat unanimously approved the Finance Bill 2021 recently. When concluding the discussion on the bill, Deputy Finance Minister I Datuk Mohd Shahar Abdullah said that a research on the abolition of the tax exemption on foreign-sourced income had been conducted two years ago.
He said that it required the ministry to interact with connected parties, including the production of a concept paper by the Inland Revenue Board, which has received detailed feedback from numerous stakeholders.
“The Ministry of Finance (MoF) must also consider the engagement and commitment of international organizations such as the Organization for Economic Cooperation and Development (OECD) and the European Union in formulating current tax policy.
“The Ministry of Finance is receptive to all viewpoints, including the establishment of a task group comprised of the Ministry of Finance, tax collecting agencies, and taxation experts from different businesses to debate the mechanism that will enable a seamless transition in January 2022.
“The Mof is dedicated to ensuring that the Act’s amendments have no adverse effect on the general public by establishing a more transparent implementation plan for the increased revenue to be channeled into the country’s recovery program,” he added.
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Mohd Shahar said that the bill is organized into nine chapters and has 67 parts.
Among other things, the law states that persons who undergo COVID-19 screening tests for personal, spouse, or children purposes are eligible for a tax exemption of up to RM1,000.
It is featured in an amendment to the Income Tax Act 1967, which also added a clause on personal, spousal, or children mental health check-ups or consultations.
Mohd Shahar declared on Nov 9, 2021, when he introduced the bill for the first reading that it will change eight legislation to implement Budget 2022 reforms. It is comprised of the Income Tax Act 1967, the Real Property Gains Tax Act 1976, the Stamp Act 1949, the Petroleum (Income Tax) Act 1967, the Labuan Business Activity Tax Act 1990, the Promotion of Investment Act 1986, the Finance Act 2012, and the Finance Act 2018.
