KUALA LUMPUR (July 12): Collection from the one-off windfall tax or Cukai Makmur (Prosperity Tax) is expected to “help a little bit” towards the revenue collection in the country at a time when the government continues to provide subsidies amid a challenging economic environment.
“The prosperity tax can help a little bit [but] we will [only] get the latest number maybe next month. We just studied it at the end of June. But apparently [the target] is as [what] we expected.
“As I mentioned in Budget 2022, we did not factor the Prosperity Tax into the government’s revenue. As such, this is an improvement,” Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz said at the launch of the Employees Provident Fund (EPF) members protection plan i-Lindung on Tuesday (July 12).
The government is expected to collect “at least RM3 billion” of Cukai Makmur, Deputy Finance Minister II Yamani Hafez Musa said in parliament on Nov 2 last year.
Tengku Zafrul noted further the government is able to bear the subsidies, given that there has been a slight increase in revenue collection, though he did not elaborate further on the matter.
He added that to increase tax rates as one of the government’s avenues was deemed very inappropriate at the moment as the economy is still in the process of recovery.
“Although the economy is expected to grow better this year than last year, to introduce a new tax system, I think this is the wrong time. We need to wait for our economy to grow to a more stable level.
“So the second way that can be adopted is to improve the yield of the government ecosystem. And one of the ways is to strengthen our cost control, and also measures to get more revenue from our agencies,” he said.
Tengku Zafrul also said the country’s statutory debt level is still low — below the 65% threshold from the gross domestic product (GDP) in line with the deficit target of 6%.
Prior to the announcement on passenger vehicle sales tax exemption deadline, which remains June 30, Tengku Zafrul had said the government — which was studying whether there is a need to extend the exemption for the tax it granted for the purchase of new vehicles — has lost RM4.8 billion worth of tax collection to date from the waiver.
He said the tax loss was considered "big" and was money that the government could have used to help the rakyat in the current challenging economic situation.
Previously, Tengku Zafrul announced that the projected consumption subsidy expenditure had reached RM77.3 billion so far this year — the highest subsidy in history ever borne by any government.