Indirect Tax – Special Alert

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SPECIAL VOLUNTARY DISCLOSURE AND AMNESTY PROGRAM (VA)

THE TIME IS NOW!

The Ministry of Finance (“MOF”) together with the Royal Malaysian Customs Department (“RMCD”) announced that a Special Voluntary Disclosure and Amnesty Program (VA) will be implemented with effect from 1 January 2022. MOF and RMCD has proposed that the VA on indirect taxes will be introduced in two (2) phases with penalty remission as follows: -

Phase

Period

Penalty Remission

%

Tax remission (pending approval from MOF)
1 1 January 2022 – 30 June 2022 100
2 1 July 2022 – 30 September 2022 50

The VA will include Sales Tax, Service Tax, GST, Import Duty, Export Duty, Excise Duty, Tourism Tax and other Indirect Tax. RMCD will be releasing detailed guidelines and FAQ in the coming weeks.

Why should businesses consider VA?

This is an opportunity provided for businesses to pay lower penalty as well as lower indirect taxes.

It allows the businesses to rectify error and omissions, make good unpaid indirect taxes and move forward with a clean slate. RMCD will not audit the taxable periods for which VA is made unless it is found that there is an element of fraud.

A word of caution – RMCD may enhance enforcement actions and increase penalties once the VA period is over.

How can we help you?

Businesses are encouraged to undertake indirect tax reviews and health checks. Those who wish to participate in this program is required to submit an application with RMCD which is subject to their approval.

We can support you in the conduct of review, confirmation of technical positions undertaken and most importantly identify any errors. If based on our review, we have identified any errors, we can then support you in quantifying the amount of tax underpaid and in the application for VA process with the RMCD.

As this program lasts for 9 months, we have set specific timelines to conduct our review of within 3 – 5 weeks to quantify the findings and highlight any errors faced by businesses. Therefore, we would encourage businesses to come forward soonest possible and take advantage of this once in a lifetime opportunity!


If you are interested in hearing more about our services, please feel free to contact our

Indirect Tax Director, Mayadevi at [email protected] or

Indirect Senior Tax Manager, Kalvinder at [email protected]

Key contact

Mayadevi Karpayah

Tax Director

E: [email protected]

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Mayadevi Karpayah  is a Tax Director with RSM Tax Consultants (Malaysia) Sdn Bhd. She is heading the Individual Tax and Indirect Tax Units and has been in tax practice for over 20 years.

Key contact

Kalvinder Singh

Senior Tax Manager

E: [email protected]

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Kalvinder Singh has over 8 years of working experience in Tax, specializing in Indirect Tax compliance, advisory and planning. He has extensive knowledge and exposure in specializing in a wide range of services from Sales Tax and Service Tax (“SST”), Goods and Service Tax (“GST”), Customs audits as well as import-export procedures.