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KUALA LUMPUR: The Goods and Services Tax Act 2014 will be amended to enable the government to collect billions of ringgit in taxes from foreign companies operating in Malaysia under the digital economy.

Custom Department director-general T Subromaniam said the proposal for the amendment would be tabled when Parliament reconvenes next month.

“The biggest loss in the digital economy is the business-to-consumer transaction. The company providing the business is overseas and in sending direct to the consumer here, they may get their payment immediately while the service is not taxed.

“That is discrimination towards local players who are taxed,” he said at a press conference on the sidelines of the GST Conference 2017 here today.

Also present was Treasury secretary-general Mohd Irwan Serigar Abdullah.

Subromaniam said among the businesses in Malaysia’s digital economy that enjoyed tax exemptions were software developers and well-known social media platforms.

He said the proposal for the amendment to the GST Act was still being discussed with the finance ministry and relevant authorities.

Meanwhile, he said the Customs Department is on track to achieving its tax target of RM42 billion for this year, including contributions from the GST. It collected RM41 billion in total taxes in 2016.

Source : Free Malaysia Today