State PKR chairman Baru Bian has described it as ‘fitting and commendable’ if Chief Minister Datuk Patinggi Tan Sri Adenan Satem were to announce that he stands with Sabah Chief Minister Datuk Seri Musa Aman in opposing the Income Tax Act 1967 amendment that sought to impose taxes on non-Muslim religious bodies.
Baru, who is Ba Kelalan assemblyman, noted that Adenan had not made a stand on this issue since the amendment was announced.
“The Chief Minister of Sarawak has not made a stand on this issue since the amendment was announced. It would be fitting and commendable if he were to announce that he stands with the Chief Minister of Sabah in opposing this amendment that seeks to impose taxes on non-Muslim religious bodies.
“This would be in line with his commitment to be a Chief Minister for all Sarawakians regardless of race, ethnicity or religion,” he told The Borneo Post yesterday.
Baru said it was interesting to note that Musa had said that he was against the taxation of non-Muslim religious bodies, in the interest of upholding religious freedom and promoting harmony among the diverse community groups.
In urging non-Muslim religious bodies in Sabah to remain calm and not speculate on the issue of tax exemption, Musa said that while he understood that the objective of the tax amendment was to curb abuse of religious donations for personal gain by unscrupulous parties, the Sabah state government opposed the move.
Musa said the Sabah state government viewed the issue seriously because some could misconstrue the move as being against all churches or non-Muslim religious organisations.
Baru said it appeared that everyone was confused about this, even the ministers, as the statements made by them seemed to be contradictory.
“The second Finance Minister (Datuk Johari Abdul Ghani) said very clearly that the amendment is to tax religious institutions that use donations for investments to generate profit.
“However, Natural Resources and Environment Minister Dato Sri Dr Wan Junaidi Tuanku Jaafar said recently that taxes will be imposed only on individuals using religion to benefit themselves.”
Baru said it was obvious that the people needed a detailed explanation from the relevant minister on the intention of this amendment and the impact of it.
“Although it seems that the impact of this amendment is still not clear, we (PKR) are opposed to the taxation of religious institutions that have always enjoyed exemptions from paying taxes.”
Meanwhile, Deputy Finance Minister Datuk Othman Aziz clarified that the amendment to the Income Tax Act 1967 was not to impose religious bodies to pay tax, but rather to ensure their income is specifically used for religious and charitable purposes.
Othman stressed the amendment applied to all religious bodies, Muslim and non-Muslim, in order to qualify for tax exemption starting with this year’s assessment.
“Tax exemption (on religious bodies) is a way for us to ensure income, such as from donations, is used for charitable, preaching and worship activities. This is to avoid misuse by certain quarters to solicit donation for other purposes under the mask of a religious body,” he told reporters when met at a briefing on the 2017 Budget in Kota Kinabalu yesterday.
The amendment to the Act that had most religious bodies confused, especially the non-Muslim organisations, involved paragraph 13(1)(b) of Schedule 6 of the Act, which specifies tax exemption only applies to contributions received by non-profit religious organisations and religious institutions solely used for charitable purposes.
Othman noted the amendment on the Act could address concerns over militant activities funded by donations.
He also said there were certain individuals earning more than RM10,000 a month who did not declare their income, citing that they worked with a religious body that was exempted from paying tax.
Source : Jonathan Chia @ The Borneo Post Online