Najib fails to delay paying RM1.69b tax

This would mean that the IRB is able to proceed with the bankruptcy proceeding against the former PM

by RAHIMI YUNUS / pic by TMR FILE

DATUK Seri Mohd Najib Razak (picture) has failed to get a stay of execution to suspend him from paying a RM1.69 billion payment in additional income tax arrears and penalties owed to the Inland Revenue Board (IRB).

The Kuala Lumpur High Court has rejected his application to suspend the court judgement for the tax payments pending a court appeal and tax assessment at the Special Commissioners of Income Tax (SCIT), a special tribunal that handles tax appeals on the amount of tax assessed.

Judge Ahmad Bache ruled that the former prime minister (PM) had no strong grounds for a stay to be granted as he had failed to prove special circumstances to the court.

This would mean that the IRB is able to proceed with the bankruptcy proceeding against Najib.

Ahmad said if a stay of execution for Najib is granted, the IRB would be stopped from filing any recovery actions against the latter, thus setting a bad precedent.

“It will set a bad precedent to be followed and used by other taxpayers as a ground to avoid or delay paying taxes and giving rise, albeit wrongly, to an inference that double standards are being allowed and being practised,” Ahmad said in the hearing yesterday.

On Feb 4, the IRB had issued a bankruptcy notice against Najib as a debtor for failing to pay the RM1.69 billion in income tax arrears and penalties as ruled by the High Court in a summary judgement.

Najib’s defence counsel Tan Sri Dr Muhammad Shafee Abdullah reportedly said Najib would “lose everything” if a bankruptcy order was granted.

At the risk of losing his MP qualification, the court agreed with the IRB that such contention is nothing more than “fear of losing”.

The judge said if the defendant wins his appeal at the SCIT, any extra amount collected could be refunded and hence, there is no issue with the appeal before the SCIT being rendered nugatory.

“On the other hand, the defendant has not shown any cogent evidence to prove the plaintiff’s inability to compensate. All these reasons merit consideration and that the balance should tilt in favour of the plaintiff to not granting the stay,” he said.

The judge also said the defendant can still negotiate with the plaintiff for some payments to be made pending the disposal of the hearing at the SCIT, and more often than not, the IRB subscribes to a payment scheme that is a “win-win” situation for both parties.

Najib also has filed an appeal against the High Court decision with the Court of Appeal, and the hearing is scheduled for tomorrow.

On July 22 last year, Ahmad ruled that Najib had to pay the IRB RM1.69 billion in additional tax and penalties for the assessment years from 2011 to 2017 after allowing the IRB’s application to enter a summary judgement against him.