KUALA LUMPUR (Dec 6): Magnum Bhd said its wholly-owned subsidiary Multi-Purpose International Ltd (MPIL) had received several notices of assessment for income tax from the Inland Revenue Board (IRB) for 2014 up to 2018, totalling RM182.8 million.

The group said MPIL had on Nov 29 received the notices of assessment for 2014, 2015, 2017 and 2018 amounting to RM40.36 million, RM40.38 million, RM38.76 million and RM24.56 million respectively.

On Dec 2, MPIL received another notice of assessment for 2016, amounting to RM38.75 million.

“The IRB now claims that MPIL should be taxed under the Income Tax Act 1967 instead of the Labuan Business Activity Tax Act 1990. Since its establishment, MPIL’s income including its interest income had been duly assessed under the Labuan Business Activity Tax Act 1990, a position which the IRB had never questioned in the past.

“Upon consulting its tax solicitors, the board of directors is of the view that there are reasonable grounds to challenge the validity of the said notices and the penalty imposed,” said Magnum in a filing today.

It added that the interest income that the IRB is seeking to subject to income tax had been disallowed as interest expense and reflected as part of the settlement of previous tax audit conducted by the IRB in 2017.

“It is anticipated that there will not be an immediate financial impact on the group as the board is seeking to secure a stand over pending the resolution of this matter,” said Magnum.

Magnum's share price closed unchanged at RM2.67, giving the group a market capitalisation of RM3.84 billion.