Better to revoke tax amendment

Kota Kinabalu: The Finance Ministry must seek to revoke or revert the recent amendment to paragraph 13 (1) Table 6 of the Income Tax Act 1967 instead of the Ministry just issuing a tax exemption order for the religious institutions.Even if such order is issued, confusion arising from the said amended paragraph will still come back to haunt the people that will be directly or indirectly affected by the amendments as the tax exemption order might just be a temporary order, said Tamparuli Assemblyman Datuk Wilfred Bumburing.

"As per the amended paragraph of the Income Tax Act 1967, there are no clear definitions of how the method of taxations will be implemented and the whole process will open to abuse or mismanagement," added Bumburing who is also Parti Cinta Sabah president.

He agreed that there are some church organisations who are seen to be conducting business activities as they are selling, usually at cost, some of the materials they use for worship activities to church members to cover the cost of production.

He said such activities should not be construed as conducting business activities as all these are part of the church activities in support of the praise and worship programs being conducted in the church.

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"So in order for the church organisation to be able to carry out their activities with ease and without any unnecessary confusion, tension and anxiety, the government must reintroduce an amendment to revoke the previous amendment to paragraph 13 (1) Table 6 of the Income Tax Act 1967."

On January 10, Second Finance Minister Datuk Johari Abdul Ghani said his ministry will issue a tax exemption order for religious institutions following the confusion arising from the amendment to paragraph 13 (1) Table 6 of the Income Tax Act 1967.

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He said the order was to exempt all types of income of religious institutions registered under the Registrar of Societies or under any written laws regulating the institutions, from tax.

He said the order, which to be issued under Section 127 of the Income Tax Act 1967 was also aimed at making clear the latest status of the religious institutions after the amendment took effect.

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