People watch a ‘live’ television broadcast of Finance Minister Lim Guan Eng tabling Budget 2019 in Parliament November 2, 2018. — Picture by Farhan Najib

KUALA LUMPUR, Nov 3 — The government can rake in billions of ringgit from tax revenue through its tax amnesty programme, according to tax specialists.

Following the introduction of the Special Voluntary Disclosure Programme in Budget 2019, Thannees Tax Consulting Services managing director SM Thanneermalai said the government can expect to bring in as much as RM10 billion from the tax amnesty.

He cited Indonesia as a successful example of this, as some of its 745,000 taxpayers had declared more than US$330 billion (RM1.37 trillion) of assets in March 2017.

“Indonesia was extremely successful last year, where they brought in more than hundreds of billions of US dollars.

“If the Inland Revenue enforces it correctly, the RM10 billion target would not be too difficult to collect,” Thanneermalai told Malay Mail.

He said the 5 per cent of the population who are defined as wealthy should be wary of their tax filing and should start disclosing income that has yet to be declared as the penalty will be harsh, ranging from 80 to 300 per cent as provided for in existing tax laws.

Axcelasia Inc non-executive chairman Veerinderjeet Singh said roughly RM3 billion will be collected from the tax amnesty.

He, however, said those affected should take advantage of such programmes as the offer may no longer be available in the future.

“There is no particular figure but there are sources who say they hope to collect RM3 billion. It is very unclear as no one has the full data, but it should bring in a lot provided people are keen to come clean and declare everything.

“But it’s not good to keep having such amnesty programmes. Chances are we are not going to have such amnesty programmes in the future so those who are affected should take advantage of this now,” he told Malay Mail.

Chartered Tax Institute of Malaysia (CTIM) president Seah Siew Yun said although the tax amnesty would have a significant impact on the country’s revenue, it is unclear how much can be collected in in total.

“It depends on how effective in getting these people to bring back the money. Many are just on the approach of ‘wait and see’.

“We also do not know the so-call leakages in the past, whether they did a very good tax cover-up or not, and it depends on the system and the willingness of the people and how the government’s tactic will be like,” she told Malay Mail when contacted.

Finance Minister Lim Guan Eng yesterday announced the Special Voluntary Disclosure Programme to be offered from November 3, 2018 until June 30, 2019 where taxpayers will receive reduced penalty rates.

The penalty rate will start from 10 per cent if it is reported from November 3, 2018 until March 31, 2019 and will increase up to 300 per cent if the disclosure is made after the programme ends.

The Inland Revenue Board will also scrutinise and investigate unexplained extraordinary wealth displayed by the possession of luxury goods, jewellery, handbags or property using necessary measures permitted by the law to recover such monies, whether in the form of additional taxes, penalties or fines.

* A previous version of this story contained an error which has since been corrected.