PETALING JAYA: The tax exemption granted to Universiti Tunku Abdul Rahman (UTAR) which was reported to be owing RM83 million to the Internal Revenue Board (IRB) is because the government does not tax non-profit education based entities.
Prime Minister Datuk Seri Anwar Ibrahim said the late approval for exemption to UTAR was because the university is still under Yayasan Tunku Abdul Rahman (TAR) whose structure has not yet been separated between the matters of commercial business companies and education.
“The issue of tax exemption for UTAR, which is a Chinese university. What is our policy? We exclude all efforts for education that are not based on profit.
“If a faculty is developed to allow poor students to study, to exempt tuition, we exempt taxes. For me there is no problem, we just announce it because of the delay in approving it due to the fact that the UTAR foundation has not been separated.
“Recently, they asked to be given a period of one year for the separation but in the meantime they are asking for an exemption for all approvals for the education of poor children,“ he said.
Anwar said this in his opening speech of the 78th Annual General Meeting of the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) here today.
The Prime Minister was previously reported to have decided to exempt UTAR from the disputes on tax and fine.
A Sin Chew Daily report quoting sources stated that tax arrears and fines amounting to RM83 million demanded by the IRB on UTAR will be written off.
Deputy Finance Minister Lim Hui Ying previously said that according to the IRB, UTAR was not granted tax exemption status, unlike the UTAR Education Foundation which received the exemption on July 1 2003 in accordance with Section 44(6) of the Income Tax Act 1967.
