Luxury tax should be introduced, says Shafie

The tax can reduce the economic gap between B40 and T20

 pic by TMR FILE

THE government should introduce a tax on luxury items such as high-end cars, yachts, private jets and other high-value items to increase its revenue, Semporna MP Datuk Seri Shafie Apdal (picture) said.

He said the implementation of this luxury tax is not something foreign in the Asean region, as countries such as Indonesia and Thailand have practised it as well.

“The government should consider imposing a luxury tax on every purchase of luxury goods and non-essential services that exceed a certain price,” he told Dewan Rakyat yesterday.

The Parti Warisan president said the luxury tax also aimed to reduce the economic gap between the low-income group (B40) and high-income group (T20), in line with the government’s Shared Prosperity Vision.

Shafie added that there was no comprehensive policy to boost government revenue except for the proposed one-off prosperity tax targeted at companies with more than RM100 million annual profits.

The former Sabah chief minister also called on the government to increase allocations for Sabah and Sarawak in Budget 2022.

The Semporna MP said the community development expenditure for Sabah and Sarawak only amounted to RM10 million, whereas the Orang Asli, Chinese and Indian communities were allocated RM200 million, RM145 million and RM274 million, respectively.

“For the record, in 2020, Sabah and Sarawak contributed about RM145 billion through petroleum revenue profits to the federal government. This accounts for 45% of the total 2022 budget.

“(It is) a large amount, but the allocation given to these two Borneo states is still insignificant to help spur development in these states.

“In this budget, the allocation given to the Chinese is RM200 million, the Indians is RM145 million and the Orang Asli is RM247 million. However, the development allocation for all races in Sabah and Sarawak is only RM10 million. Where is the equality?” said Shafie.

He added that according to the Finance Ministry, the country’s revenue in 2020 will be lower than the government spending, where Malaysia’s deficit for 2022 is expected to reach RM100 billion.

“If we look at 2019 when the Pakatan Harapan government ruled, the country’s revenue increased by 12% compared to the previous year of RM264.42 billion.

“In 2020, there will be a decrease of 14.9% to RM222.08 billion. This can be explained due to several economic closures in 2020,” he said further.