The Covid-19 pandemic has led to a collapse in government revenue as expenses skyrocketed in attempts to contain the outbreak even as the economy deteriorated. With financial numbers looking more dire, are new taxes in the offing?
After nearly 2 and a half decades of spending more than it earns, Malaysia now has a fiscal deficit that is projected to balloon to 7% of gross domestic product this year while the debt ceiling may be nudged up to 65% of GDP.
Tai Lai Kok, Head of Tax of KPMG in Malaysia commented: "As the 12th Malaysia Plan calls for significant funds to be made available for the government and existing tax revenue sources may be hard-pressed to contribute the amounts required, there is no doubt that the government is considering new sources of income.”
