KUALA LUMPUR: The Federal Government’s 2024 revenue projected to increase to RM312.159 billion after taking into account Budget 2024 tax measures, contributed by higher tax revenue collection and better economic growth.
Deputy Finance Minister Lim Hui Ying said tax revenue remains the main contributor at 79.5 per cent of total revenue, or 12.57 per cent of gross domestic product (GDP), while non-tax revenue represents 20.5 per cent (or 3.24 per cent of GDP).
“Revenue collection will be supported by strong economic growth and measures taken to further increase revenue mobilisation by expanding the tax base and improving tax compliance and transparency,“ she said in response to a question from Muhammad Ismi Mat Taib (PN-Parit) on the measures taken by the Finance Ministry to review the current taxation structure, taking into account current economic changes.
Lim said the government is committed and has taken steps to diversify and increase the country’s sources of income.
She explained that revenue mobilisation measures include broadening the tax revenue base, improving and revising tax structures and legislation, and the provision of tax incentives.
“This will be made via the implementation of the Medium Term Fiscal Strategy (MTRS) to ensure that medium term tax planning is more organised and in line with expenditure.
“Additionally, the government has also enacted the Public Finance and Fiscal Responsibility Act 2023 effective Jan 1, 2024, which is expected to strengthen the country’s governance and fiscal discipline,“ she said.
Lim also said the government has expanded the scope of the service tax to include logistics, brokerage, underwriting and karaoke services in Budget 2024.
The service tax rate was also raised to eight per cent from six per cent for all services, with the exception of food and beverages, telecommunication, parking and logistics services.
“The government will also implement the luxury goods tax, capital gains tax and e-invoicing this year to expand the country’s revenue base,” she said.
Meanwhile, in his supplementary question, Muhammad Ismi also asked about the government’s measures to deal with fraud and dishonest tax declaration.
Lim said the government is of the view that the existing legal provisions and administrative procedures are generally sufficient to overcome irregularities and abuses in the existing and new taxation structures.
“Furthermore, in line with Budget 2024, the government will implement e-invoicing in stages which will help detect non-compliance more effectively. The ministry will, nevertheless, continue to monitor the situation from time to time,“ she added. -Bernama
