Deputy Finance Minister Datuk Awang Adek Hussin yesterday told the Dewan Rakyat that the Inland Revenue Board (IRB) is taking the appropriate steps in accordance with legal provisions to collect backdated taxes owed by Kuala Dimensi Sdn Bhd (KDSB), the turnkey contractor of the Port Klang Free Zone (PKFZ) project.
In a reply to Tony Pua’s (Petaling Jaya Utara-DAP) adjournment speech, Awang Adek said IRB did not have the power under the Income Tax Act 1967 to seize cash or assets from taxpayers who had yet to settle their taxes.
Pua’s speech posed several questions to the finance ministry on why KDSB had owed the IRB backdated taxes amounting to RM328.4 million and why the IRB had not enforced its rights under the Income Tax Act 1967 to collect the taxes irrespective of any appeal or dispute raised by the taxpayer.
Pua cited Section 103A(2) of the Income Tax Act 1967 which stated that tax payable for a year of assessment “shall be due and payable on the due date whether or not that company appeals against the assessment”.
Awang Adek did not respond to Pua’s specific question but said, “The IRB will directly deal and negotiate with KDSB to solve the disputed amount of taxes”.
The Edge Financial Daily had reported on June 29 that the IRB had appointed PKFZ’s owner, the Port Klang Authority (PKA) as the agent for KDSB’s backdated taxes and ordered PKA to remit RM328.4 million allegedly owed by KDSB.
The IRB later retracted its appointment of PKA as the agent for KDSB’s backdated taxes.
Commenting on the company’s tax bill, KDSB CEO Datuk Faisal Abdullah had said the company was disputing accounts for the years 1997 and 1998, adding that the company was ready to head to court to settle the disagreement.
Written by Chua Sue-Ann
This article appeared in The Edge Financial Daily, July 15, 2010.
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