By MOHD AMIRUL RADZUAN
HOW SELF ASSESSMENT SYSTEM IMPROVES OUR TAXATION SYSTEM
Taxation is one of the essential parts of the Malaysian economy. People of the Malaysian market help to maintain all essential rules and regulations of taxes. The country’s people for a better understanding of taxes have followed some particular laws and rules. “The IRBM or the Inland revenue board of Malaysia” helps to audit and collects taxes and documents. There are two types of audits including “field audits and desk audits” (Binti Azemi, 2020). The Financial condition of Malaysia will improve through effective tax policies and procedures. The field audits provide to improve taxpayers and identification of business records. On the other hand, Desk audit provides official employees of IRBM. The people of the country have followed all rules and regulations of the country. The IRBM provides risk assessment policies and procedures that help to increase tax players.
Specific issues have affected the tax auditors and demonstrated most penalties. Some innovation strategies, policies, and effective technologies have been used by the country to utilize business growth across the global market. The proper usage of ANN helps to collect quantities of data related to tax policies and procedures. The Loan policy of Malaysia has maintained the finance minister of the country (Othman, Nordin & Sadiq, 2020). The credit agreement policy will approve by the minister of the country. The tax authorities of the country must need to build confidentiality in the tax system of the country. After the pandemic, the government of Malaysia will apply some innovative strategies and policies. The economic growth of the country depends on its financial condition. Active taxpayers have followed all policies and procedures of the country.
The rules and regulations of the tax system also play a vital role to utilize the overall performance rate of the government. These rules and policies help to progress the economic condition of the country. It helps to utilize government efforts and supports for poor people of the particular country. Taxpayers’ compliance and procedures must follow to develop the economic condition of Malaysia. The tax department of Malaysia has changed the self-assessment system (SAS) in an official way (Tat, Hui & Hiung, 2022). SAS was an important reformation that helped to compliance the “Income Tax Act (ITA) 1967.” Tax complexity reduces the SAS process and provides more facilities for taxpayers. The SAS helps to develop the income level of taxpayers. It is observed that the Non-Compliance tax process is one of the big obstacles to collecting taxes. The non-compliance tax process occurs in tax penalties and audit fees for taxpayers. Despite these, the non-compliance tax system helps to increase the period because taxpayers use advantages to pay low taxes.
This Above image reflects the tax revenue of Malaysia. “On-compliance tax laws and regulations” refers to the behaviour of the tax system that fails to follow all rules of tax authorities. “Non-compliance tax system” has provided strong rules for tax collection and its efficiency (Salawati et al. 2021). It is noted that there are 2 million active taxpayers living in Malaysia and 80,000 prospective taxpayers need to complete registration. In 2019, the tax authorities of Malaysia lost RM 2000 million in taxes approximately (Statista, 2023). The tax authorities in Malaysia help to improve compliance and regulations of tax systems that are encouraged taxpayers of Malaysia. Therefore, day by day, the entire tax liabilities help to develop the tax growth of Malaysia. Most individuals provide their efforts to maintain the tax system and improve their income per year. Therefore, it can be said that the government of the country has used effective and modern technologies. In the 21st century, modern technologies and tools have helped to utilize overall taxes compliances and procedures.