KUALA LUMPUR (Nov 23): Malaysia's direct tax collection target of RM143.9 billion in 2021 is expected to be achievable, according to the Inland Revenue Board (IRB).
Speaking during a panel discussion at Deloitte Tax Max 46th Series webinar today, IRB chief executive officer (CEO) Datuk Seri Sabin Samitah noted that direct taxes will account for 40.9% or RM143.9 billion of Budget 2021, and also 55.7% of total government revenue for 2021.
According to him, Malaysia's economy is expected to recover and grow at a rate of 6.5% to 7.5% next year, due to the proactive measures undertaken by the government through various economic stimulus packages as well as the projected global economic growth of 5.2%.
"Therefore the expected increase in tax revenue is expected to be reasonable and in line with better economic conditions. Yes, it (the country's direct tax collection target) is achievable," he said.
The federal government's revenue in 2021 will be mainly driven by direct tax revenue, while indirect tax revenue will contribute 17.9%. On the other hand, non-tax revenue is projected to contribute 22.4%.
Meanwhile, in 2020, direct tax is expected to account for 50.6% of federal government revenue, while indirect tax will contribute 16.8%. Non-tax revenue is expected to contribute 32.6%.
In comparison, in 2019, direct taxes made up 50.6% of government revenue, while indirect taxes and non-tax revenue made up 17.3% and 31.7% of revenue.
Bernama reported last week that Finance Minister Tengku Datuk Seri Zafrul Abdul Aziz had expressed high hopes that the IRB was able to collect its tax collection target of RM127 billion for the 2020 tax year, as well as the targeted RM143.9 billion in direct taxes for 2021.