KUALA LUMPUR, Mar 9 (Sin Chew Daily) — Taxpayers participating in the voluntary disclosure program under the Inland Revenue Board's Special Voluntary Disclosure Program (SVDP) in 2019 for the period from 2011 to 2017 have received letters from the IRB that investigation would be carried out for the period when declaration was made.

Sin Chew Daily learned that the Chartered Tax Institute of Malaysia (CTIM) received complaints from members taking part in the SVDP as they received letters from IRB informing them they had not declared all taxable income as required under the Income Tax Act.

As a result, IRB will conduct investigation under Sections 78 and 79 of Income Tax Act on their disclosures for the period.

CITM wrote to IRB chief executive officer Datuk Seri Sabin Samitah who had said earlier that there would be no auditing or investigation on voluntary disclosures made through SVDP in which the disclosures would be accepted in good faith.

However, in reply to CITM, Sabin said Section 1.4 of the guideline on SVDP states that taxpayers are to report full income and pay tax.

Section 5.9 of the guideline also stated that IRB would accept the declaration under SVDP in good faith but computation of tax would be checked to ensure accuracy.

Both IRB and CTIM did not elaborate further on this matter.

SVDP was launched by the Pakatan Harapan government in 2018 offering a reduction in the penalty rate from 300% to 10% if the declaration is made in the first phase from Nov 3, 2018 until March 31, 2019, and subsequently 15% if the declaration was made in the second phase beginning April 1, 2019 until June 30, 2019.

The government welcomed voluntary disclosures (if any) from taxpayers who had income derived from Malaysia and overseas which they had yet to declare to IRB.

In an exclusive interview with Sin Chew Daily on March 23, 2019, Sabin said the IRB accepted voluntary disclosures from taxpayers in good faith and that they would not be subjected to further investigation or auditing.

IRB had anticipated one million taxpayers to take part in the SVDP program. But at the end, only 286,482 taxpayers made voluntary disclosures, of whom 11,176 were new taxpayers. IRB collected some RM7.88 billion in taxes, extra taxes and penalties through SVDP.