The Malaysian Insight

PUTRAJAYA is estimated to rake in more than RM244.5 billion in revenue next year, lower than the total earned in 2019, said the Finance Ministry today.

It said the higher revenue this year was due to the RM30 billion special dividend the government received from Petronas.

Minus the sum, Putrajaya made RM233.3 billion from taxes, licences and investment income.

The revenue for 2020 from taxes, licences and investment income will be 4.8% higher, said the ministry’s Fiscal Outlook and Government Revenue Projections Report.

The special dividend from Petronas was to help Pakatan Harapan settle refunds for the goods and services tax, as well as income tax that the former Barisan Nasional administration failed to pay.

Of the estimated RM244.5 billion to be earned next year, 77.7%, or RM189.9 billion, will come from taxes.

Direct taxes, such as those from corporations and individuals, are estimated to increase 5.2% to RM142.7 billion from this year’s RM135.6 billion.

The ministry said the bulk of the increase will be from the improved collection of corporate and individual income taxes, estimated at RM75.5 billion and RM37.4 billion, respectively.

“Higher corporate income taxes will be primarily due to the prospect of better corporate earnings, and continuous efforts in auditing and tax compliance.”

Petroleum income tax is expected to fall to RM17.5 billion next year from 2019’s RM17.9 billion, owing to a projected drop in global oil prices.

Indirect taxes, which include the sales and services tax and excise duty, are expected to rise to RM47.3 billion in 2020 from RM44.4 billion this year.

SST, which came into effect in September last year to replace GST, is expected to contribute RM28.3 billion in 2020, an increase of 5.6% from this year’s RM26.8 billion, due to higher consumption.

Non-tax revenue from licences, permits and investment income is estimate to total RM54.6 billion next year. – October 11, 2019.