Second Finance Minister, Johari Ghani today revealed that both Jho Low and Riza Aziz have never paid taxes in Malaysia.
Replying to DAP’s Lim Lip Eng in Parliament, Johari said the duo has never declared their income in Malaysia and this the Inland Revenue Board (IRB) cannot tax them.
Opposition supporters jumped with joy upon hearing this, with some asking how can they not be taxed when they throw wild parties frequently. As usual, Opposition supporters know very little about anything else than to whine about everything.
If the duo have a business in Malaysia and earn their income in Malaysia, the IRB would definitely have jumped on them.
Unfortunately, this is not the case as the duo earn their income overseas.
If the Opposition supporters use the Internet to Google for the correct information rather than spending their life reading trash in portals like Sarawak Report, they would have come across this in the IRB’s website:
“Mulai tahun taksiran 2004, pendapatan yang diterima di Malaysia dari luar Malaysia adalah dikecualikan daripada cukai. Dengan itu, pembayar cukai sama ada yang bermastautin atau yang tidak bermastautin di Malaysia dikenakan cukai atas pendapatan yang diperoleh dari Malaysia sahaja.”
And Lim Sian See adds:
Why Jho Low and Riza Aziz do not pay tax in Malaysia?
They are not in the country 182 days or more per year and do not earn their income here.
Therefore, they are not considered as TAX RESIDENT in Malaysia and hence do not pay tax here.
Presumably, they will pay tax in the countries where their jobs are or spend most of the time in.
Tax accountants will understand this.
Please ask Lim Guan Eng if he understands the concept of tax residency or not.
Second Finance Minister has also issued a statement as follows:
1. I wish to clarify further to my reply to the Segambut MP, YB Lim Lip Eng and Batu MP, YB Tian Chua who recently asked me about the tax file(s) of a Mr. Reza Aziz and Mr. Jho Low and why these two individuals are not paying tax in Malaysia.
2. The tax collection system in Malaysia is based on the simple premise that if an individual or company derives income from Malaysia, that income received will be subjected to Malaysian income tax. While income derived from outside Malaysia and remitted to Malaysia will be exempted from tax. This applies to all individuals or companies without any exceptions. It is important for LHDNM to determine whether the income is derived from Malaysia before income of an individual or a company is subject to Malaysian tax.
3. The initial finding of LHDNM has shown that the two individuals, who were the subject of enquiries by the Opposition MPs in Parliament, do not have income derived from Malaysia in the past recent years and there are no records that they have brought in taxable income derived from overseas into Malaysia. Even if they had brought their income which is derived from overseas into Malaysia, this will be exempt from income tax. However if it is later discovered that any of their income is indeed subject to Malaysian tax, LHDNM has the power to raise assessment against those individuals within 5 years or at any time if fraud, wilful default or negligence is proven.
4. Malaysia has adopted a self-assessment system, where an individual or a company is required to determine and compute their chargeable income and tax liability. The rate of tax applicable is provided under the Income Tax Act 1967 and changes to the rate may be made and announced during the Annual National Budget. Under the self-assessment system a taxpayer will be audited on any declaration of income made. In the case where a person fails to make any declaration, LHDNM has a dedicated team to continuously analyse and identify this and severe penalties will be imposed once LHDNM has ascertained that tax is payable. It is not the practice of LHDNM to tax any individuals or companies based on perceived wealth or rumours of income.
5. Please be assured that LHDNM is ever vigilant in carrying out its duties under the law without fear or favour.
DATUK SERI JOHARI ABDUL GHANI
Minister of Finance II