Online business tax is okay, says Muslim consumers body

PETALING JAYA: The idea of taxing online businesses is not a bad idea, but the government must be compassionate in implementing such a tax, Malaysian Muslim Consumers Association President Nadzim Johan said today.

Commenting on reports that the Ministry of Finance is looking to tax online businesses next year, Nadzim said he agreed with taxation as many online businesses were doing very well.

“Taxation of online businesses will ensure that the businesses are registered and regulated,

“However, not all online businesses should be taxed. The government should come up with a formula to ensure those whose businesses surpass a certain revenue level are taxed.”

An online bakery shop operator, who only wanted to be known as George, questioned the rationale behind the taxation, labelling it as ridiculous, and that it might lead to increased prices and subsequently, losses.

Deeper Than Fashion founder Harmini Asokumar said taxing the online businesses would be “unkind”.

Harmini, who sells fashion accessories online, said many people opted for online businesses to supplement their income,

“It is already very hard for Malaysians to survive due to the rising cost of living, and online businesses are ideal for anyone – from college students to housewives – to make ends meet,” she told FMT.

On Facebook, many reacted angrily to news reports on the matter, with some saying the move would burden the people, and others lamenting the possibility of yet another tax after the GST.

Meanwhile, VapeClub Malaysia co-founder, Jeremy Ong agreed with the idea of taxing online businesses.

Ong said the implementation of income tax was not sales tax, so there should not be any case of costs being passed to customers.

The Ministry of Finance is looking to tax online businesses next year in line with the growing Internet-based sector.

Treasury Secretary-General Mohd Irwan Serigar Abdullah said the ministry had requested the Inland Revenue Board to conduct a thorough evaluation of the matter.

“We are also interested in getting those undertaking online businesses to register with the Companies Commission of Malaysia, to enable us to track how much they earn,” he added.

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