23rd September 2021 - 2 min read
The government is considering the implementation of a capital gains tax as a means to refill the funds spent on Covid-19 efforts. This is in addition to the possibility of a one-off higher tax rate imposed on companies that have generated windfall profits during the pandemic.
“The government is looking at a few ways in which it can increase its revenue, including implementing the taxing of capital gains on shares and also imposing a one-off higher tax rate on companies that have obtained extraordinary profits during the pandemic,” said the deputy finance minister II, Yamani Hafez Musa in the Parliament yesterday, adding that the extra revenue will be used to assist the recovery of selected groups.
Yamani also said that they will first need to obtain feedback from stakeholders before making any decisions. “The government needs to take into account the views and feedback of affected stakeholders to ascertain the effects of imposing these taxes, so that it does not affect Malaysia’s economic standing and competitiveness, specifically in attracting foreign investments,” he further commented.
Finally, Yamani Hafez shared that the government is also in the midst of looking for a viable solution to offer an interest-free loan moratorium for borrowers. The solution must take into account the long-term effects on various parties, including borrowers, depositors, investors, financial institutions, and the economy, he said.
As such, the government is currently still in talks with financial institutions as it involves a commercial decision between bank managements.
(Source: The Edge Markets)
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