The government has no plans to introduce a 2% wealth tax on wealthy individuals to help fund its spending, according to the Finance Ministry.
In a written reply published on Parliament’s website, the ministry said a wealth tax is unlikely to generate significant revenue once tax exemptions and reliefs are taken into account, similar to other existing taxes. It added that any proposal to introduce a wealth tax would need to be carefully studied, taking into consideration several factors, including Malaysia’s relatively small and limited tax base.
“The implementation of a wealth tax, in whatever form or mechanism, must be carefully examined,” the ministry said.
Govt focusing on targeted taxes instead
Instead of introducing a wealth tax, the ministry said the government is taking a more targeted approach by expanding the tax base to include those with greater financial capacity.
Among the measures already in place are the capital gains tax on the disposal of unlisted shares, a dividend tax on annual dividend income exceeding RM100,000, and a tax on profit distributions above RM100,000 received by partners in a limited liability partnership (LLP).
The ministry added that the government remains committed to ensuring Malaysia’s tax policies are fair, progressive and more targeted, while helping to reduce socioeconomic inequality.
Follow Wah Piang for more.
