Zouhair Rosli of DM Analytics says the government should introduce the wealth tax rather than bring the GST back.
PETALING JAYA: As the income tax season reaches its tail-end, an analyst has called for higher tax rates to be imposed on the super rich in Malaysia.
DM Analytics senior researcher Zouhair Rosli said that rather than re-introduce the goods and services tax (GST), the government should make the super rich pay higher taxes.
“For instance, we could introduce the wealth tax (a tax based on a person’s net worth) on the uber-rich,” he told FMT Business.
He pointed out that the cumulative wealth of the 50 richest Malaysians grew to over RM360 billion last year.
“That is almost on par with our 2023 national budget. Just 10% of that money would be enough to fund the health ministry’s year-long budget,” he pointed out.
In a revised budget tabled in February, Prime Minister Anwar Ibrahim announced that the government would allocate RM388.1 billion for operating and development expenditures.
“We are reluctant to make the rich and the big corporations pay more, for fear of capital and investment flight. But in reality, we are not taxing them enough,” Zouhair said.
The 20% of Malaysians in the top income bracket, also known as the T20, accounted for 85% of all taxes collected in 2022.
Zouhair Rosli of DM Analytics says the government should introduce the wealth tax rather than bring the GST back.
The super rich in Malaysia, who live in the most expensive homes and drive the most sporty cars, are not contributing enough to the nation’s coffers, according to a researcher. (Facebook pic)
On the other hand, they will benefit the least from all the money they pay. For instance, they will soon be excluded from the subsidy system, leaving them to pay more for electricity and fuel.
But Zouhair feels that the top earners in Malaysia are still under-taxed.
“The well-to-do (group is) taxed too much? Not true. There was no increase in their tax rate (in the 2023 budget). In contrast, the ‘poorer’ (saw an) increase in their tax rate,” he added.