MALAYSIA: FINANCE MINISTER GUAN ENG EXPOSES ANOTHER CASE OF ALLEGED FUND MISMANAGEMENT

PUTRAJAYA, Malaysia Aug 22 (NNN-Bernama) � Finance Minister Lim Guan Eng today exposed what is believed to be another case of alleged mismanagement of public funds by the previous Barisan Nasional (BN) government.

He claimed that the previous government failed to refund RM16.046 billion in overpaid income tax and property gains tax over the past six years, which was due to 1,653,786 companies, individuals, associations and foundations as of May 31 this year.

Lim said in a statement that the yet-to-be-refunded credit balance of the Inland Revenue Board (LHDN) was due to a shortage in the transfer of the direct tax revenue to the Tax Refund Fund (TBBC) trust account.

Tax refunds can only be made based on the amount of money remaining in the TBBC. The balance in the TBBC as of May 31 this year was only RM1.486 billion based on the records of the Accountant-General’s Department.

This amount is much lower than the sum required for the refund of tax credit amounting to RM16.046 billion which should have been refunded.

In other words, there is still a shortage of RM14.56 billion as of May 31 this year, which resulted in the 1,653,786 taxpayers not getting their refunds over the past six over years, he said.

Lim said it was clear that the previous government had assumed or recognised the RM14.56 billion that was not transferred from the Consolidated Fund to the TBBC as government revenue.

This meant that the federal government revenue reported by the previous government was inaccurate and over-reported, he said.

The huge arrears in credit balance refund of over six years arose because the Cash Management Committee of the Finance Ministry which met monthly and was chaired by the former Treasury secretary-general, Tan Sri Dr Mohd Irwan Serigar (Abdullah), did not transfer a sufficient allocation to the TBBC as requested by LHDN.

As I explained earlier, what the previous government had done was the falsification of accounts and misappropriation of the arrears in credit balance refund for other uses or to cover its deficit to show a surplus, he said.

Lim said that to ease the taxpayers’ burden, the present government allowed taxpayers with tax credits to be repaid by LHDN to apply to set off their tax liabilities in the current year.

He said the set-off application should be submitted to LHDN for verification and consideration for approval.

He also said that the refund would be made according to the capability of the government financial position.

We believe this failure to refund the direct taxes amounting to RM16.046 billion is the latest mega exposure with regard to the (alleged) financial misappropriation and abuse scandal of the previous government.

The new Pakatan Harapan government, which is guided by the principle of Competency, Accountability and Transparency (CAT), will strive to address such problems and scandals, including returning the huge arrears in the tax refund.

After this, the Pakatan Harapan government will focus on formulating economic policies that will enable Malaysia to drive forward by planning sustainable economic growth, improving the nation’s fiscal position and ensuring the well-being of the people for a future full of hope for our children, he said.

Lim had made an exposure about alleged financial mismanagement of the previous government with regard to the Goods and Services Tax (GST) in a speech in the Dewan Rakyat (Lower House) on Aug 9.

When tabling the Goods and Services Tax (Repeal) Bill 2018 for second reading in the House, he had revealed that the previous government had failed to transfer sufficient funds into a trust account for the refund of GST amounting to RM19.397 billion as of May 31 this year.NNN-BERNAMA

Source: NAM News Network