Former chairman of the Council of Eminent Persons Tun Daim Zainuddin pointed out during an interview that the authorities sent out income tax notices to the people, causing people to feel panic and afraid to spend. As a result, the ringgit value dropped.
Earlier, the Inland Revenue Board’s move of sending out 8.3 million notices under the Voluntary Disclosure Program has triggered polarized reactions from the public, and Daim described it as disturbing.
The advice by Daim, a former finance minister highly trusted by prime minster Tun Mahathir, should be treated with seriousness by the relevant departments.
There are two things in Daim’s remarks that we need to take note of.
Firstly, he put it very straightforward that the IRB should not “disturb the people” but that does not mean IRB cannot check the taxpayers’ tax conditions or go after the defaulters.
Income tax is one of the most important revenue sources for the national coffers, and the IRB must perform its duties firmly and effectively to make sure taxpayers pay their due taxes to replenish the treasury.
However, the IRB must also be very cautious when performing their duties so as to avert unnecessary backlash from the public.
The IRB’s earlier heavy-handed actions such as mobilizing armed enforcement personnel to knock at the doors of tax defaulters in the middle of the night, sparked tremendous outcry and frustration.
Fortunately the IRB no longer adopts such a hard-line approach today, but the justification for sending out 8.3 million notices to taxpayers remains questionable, and Daim is obviously not very happy with it.
According to the authorities, the notices are only sent to tax defaulters, and taxpayers who have conscientiously paid their taxes should not be afraid and should just ignore the notices sent to them.
That said, such action will invariably put some mental stress on some people. It is hoped that the IRB will take this into serious consideration.
It is perfectly alright for the IRB to conscientiously perform its duties, but as Daim said: tak perlulah kacau orang!
Secondly, Daim has been inspecting IRB’s notice-sending policy from a more macroscopic perspective. He is not just looking at tax collection per se, but also a much bigger economic picture.
To him, IRB’s move is not just about tax collection, but also its implications on consumerism and the ringgit’s value.
Probably due to its own scope of duty, the IRB may not have a more macroscopic view of the changes taking place in the entire economy.
Bear in mind that many things in this world are actually interlocking and mutually influential. Certain actions by the IRB may produce effects that extend far beyond the scope of tax collection.
In short, the IRB has the right and obligation to pursue unpaid taxes, but this has to be done in an appropriate manner lest it will cause unnecessary trouble to businesses or individuals.