The government has no plans to introduce a 2% wealth tax on wealthy individuals to help finance its expenditure.
The Finance Ministry (MOF) confirmed this in a written reply published on the Parliament website.
According to NST, the ministry said the revenue collected from a wealth tax might not be significant if taxpayers were granted exemptions and reliefs similar to those available under existing taxes.
It added that introducing a wealth tax through any form or mechanism would require careful consideration.
Among the factors that must be examined is Malaysia’s relatively small and limited tax base.
Govt aims to maintain progressive tax system
Despite not planning to introduce the tax, the ministry said the government remains committed to developing tax policies based on fair and just principles.
It added that tax measures should be more targeted to ensure that Malaysia’s tax structure remains progressive and can help reduce socioeconomic inequality.
Instead of implementing a wealth tax, the government has adopted a more targeted approach by broadening the tax base to include individuals with greater financial capacity.
Measures introduced include capital gains tax on the disposal of unlisted shares and dividend tax on dividend income exceeding RM100,000.
A tax is also imposed on profit distributions exceeding RM100,000 received by partners in a limited liability partnership.
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