THE government, who has listed the national debt at RM1.087 trillion on its balance sheet, should note that its actual long-term debt is RM885.9 billion, says an accounting and consulting firm.

Grant Thornton Malaysia country managing partner Narendra Jasani said the RM201.4 billion difference between the two figures were annual lease payment commitments under public-private partnership projects. 

“This is an income statement issue. The actual debt, which now includes government guarantees for entities which are no longer able to serve their respective debts, translates to a debt-gross domestic product ratio of 65.5% based on end-2017 figures,” he said.

In a statement on the 2019 Budget, Narendra noted that drastic or over aggressive measures would hurt economic growth, employment and development for the nation.

On taxes, he said the government needed to ensure that existing taxes were correctly paid and collected before considering implementing new taxes.

“However, tax audits and investigations are needed, particularly where the taxes long remain unpaid or appear to be at an unreasonable level. The Inland Revenue Board and the Customs Department need to improve tax compliance, while reducing the tax gap,” he added.

As for taxing internet sales, Narendra said most physical goods were subject to the sales Ttx when sold by the manufacturer to the wholesaler or directly to retailers.

“Goods imported from overseas are also subject to the sales tax before being released by Customs at the ports of entry. But sales via theiInternet may not be subjected to the tax, if the consignments are worth below RM500.

“In this scenario, not only has the government lost the tax revenue, but it is inequitable to the local wholesalers and retailers who are providing employment and support to the Malaysian economy,” he said.

To solve the situation, he said the country could emulate the online taxation system in Australia where the e-commerce companies have to pay the sales tax on goods sold overseas. – Bernama, October 18, 2018.