KUALA LUMPUR: The Inland Revenue Board of Malaysia (IRB) expects to achieve and possibly surpass its initial tax collection target of RM176.1 billion by year-end, as it is continues to reach its monthly goal entering the final quarter of 2023.
“To this date, we are ahead of the projected day-to-day target, so that is very encouraging. We are confident that the target revenue collection will be met … hopefully (surpass) but by how much, we don’t know yet but as much as possible,” he said during the ‘Engagement session with the CEO of IRB’, organised by the Chinese Chamber of Commerce and Industry of Kuala Lumpur and Selangor here today.
CEO Datuk Dr Mohd Nizom Sairi said that based on the current collection performance versus its projection for the year, it is “still on track” to reach its target as it has achieved and even surpassed its monthly target consistently.
“Suffice to say, its actually higher than the monthly target that we have set to achieve that yearly target,” he added. However, he declined to share the tax collected to date.
He said that it is mainly driven by economic growth as well as increased tax compliance by tax payers in general.
“There’s (economic) growth even though its not as high as expected. Secondly, the increase in the level of compliance as a result of increase in awareness, understanding, education and better services that we provide,” he said.
“In 2022, the economy grew by 8.6% but tax revenue increased by 21%. How do you explain that growth? Partly the economy but definitely increase in the level of compliance of the taxpayer community. Where there’s a lack in compliance, have now increased in tax compliance,” he added.
He said that IRB has received “very positive and appreciative” feedback from corporations, driven by improved service levels through engagements with companies including tax advice and assistance.
On challenges, he pointed out that the gross domestic product (GDP) for the second quarter this year have shrunk slightly to 2.9% from 5.6% recorded in the quarter prior.
Relating it to the trend of tax payment, he noted that a lot of cases whereby companies have revised their current year estimate downwards in the middle of the year.
“We’re keeping track but overall, we’re still above the threshold and that is something that is good to know,” said Nizom.
“Tax is related to profit. So last year, they projected profit for this year so much that maybe they reduced down, maybe they’re expecting their current year profit to go down a bit. So, we are monitoring this, but net wise … take all in, we’re still in a positive growth and that’s encouraging to see,” he added.
He shared that IRB has collected RM9.5 billion from the Prosperity Tax in 2022.
“RM7 billion was collected last year, and in January another additional RM2.5 billion. So, a total of … close to RM9.5 billion about RM10 billion as we have estimated,” he said.
