CYBERJAYA — June 15, 2017: Expatriates who have left Malaysia since 2012 also left behind unpaid taxes totalling over $50 million.
Most were from the services sector and had either falsified their real wages in the expatriate’s application form or had declared a lower wage than actual.
Some also abused the student pass and did not attend college but instead carried out businesses and did not declare the income to the Inland Revenue Board (LHDN).
“We can also see (this) from the amount of remittances to their countries of origin and their luxurious lifestyle in this country,” said LHDN chief executive Datuk Sabin Samitah after the launch of the MyEXPAT system for expatriate’s income collection here today. Present was Immigration Director-General Datuk Mustafar Ali.
According to Sabin, LHDN was in talks with 75 countries that had signed the Double Taxation Agreement to recover tax from the expatriates.
Although we still do not have a specific mechanism to do so, this method has proven effective as it has been done in some other countries,” he said.
Sabin also said that this year LHDN will take action including blacklisting, fines or imprisonment against employers or sponsors who fail to carry out their responsibilities to deduct the tax of foreign workers before they return to their respective countries.
LHDN will work with Immigration through the Expatriate Services Division to check the status of their tax before leaving Malaysia.
According to statistics, income tax collected from expatriates showed a consistent increase. Last year RM201.31 million was collected compared to RM201.27 million and RM144.36 million in 2015 and 2014 respectively.
On the MyEXPAT, Sabin said the system formerly known as FORIN and developed for internal use, will use the information obtained from Immigration to monitor tax matters relating to expatriates in Malaysia.
MyEXPAT will be used in all LHDN branches nationwide from July 1 to ensure the entry of expatriates to Malaysia met with the stipulated conditions.
Mustafar said the top five sectors preferred by expatriates in Malaysia are construction and manufacturing (each 22 per cent), services (14 per cent), oil, gas and energy (11 per cent) and education (eight per cent). — Bernama