Friday 29 Mar 2024
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This article first appeared in The Edge Financial Daily on January 15, 2019

KUALA LUMPUR: The Inland Revenue Board (IRB) has formed a task force to scrutinise and investigate unexplained extraordinary wealth, such as luxury goods, jewellery, handbags and property owned by individuals.

IRB chief executive officer Datuk Seri Sabin Samitah said the task force was set up last September.

“I can confirm we have a task force looking at this group of taxpayers who have accumulated assets, but when we check their [tax] returns, they have not declared them. [Simply put], the total assets that they own do not match what were declared in their returns,” he told a press conference held in conjunction with KPMG Malaysia’s dialogue with the IRB yesterday.

“We have identified about 80,000 taxpayers (companies and individuals) and we have sent out special forms requesting them to furnish the IRB with their sources of funds to finance the accumulation of their assets,” he added.

Sabin said individuals conducting online businesses using social media would also be scrutinised.

The IRB has an e-commerce division as part of its tax compliance department which looks at online businesses.

“The main source of information in carrying out profiling and auditing of e-commerce in [the IRB] is through data collection from other government agencies and from independent third parties.

“The data gathered will then be processed by the e-commerce division to determine and analyse the compliance rate of that business,” he said.

Sabin added that IRB officers in the e-commerce division will browse the Internet and the social media to search for online businesses that have yet to register as taxpayers.

This, however, does not mean the IRB is going to check individual social media accounts for flaunting lavish lifestyles, stressed Sabin.

“As long as they can explain the sources of their [wealth]... if they are paying RM100,000 in taxes every year, I am sure they can afford [this lifestyle]. We will look at their tax declarations,” he said.

On how the IRB would obtain information on individuals who lead lavish lifestyles, Sabin said, it is through third-party information, but clarified that “it is through [our] internal information gathering”.

The IRB also uses a web crawler software for the automatic web mining of information, which speeds up the detecting and information gathering process.

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