The old man is right…

After yearly fiascos like this, I think the old man has a point.

Too busy to blog…

So, I’ll leave you with a quiz:

What relatively recent change in the tax laws resulted in the “robbing of the poor to pay the rich”?

They pretend to giveth… and they snatcheth away before ye can even smell it

Inconsiderate power abusing pricks. That’s the new term I’ll use to describe them from now on.

First, the gazette ain’t even out yet, despite the “law” supposedly having been effective from 1 January 2008. But, they issue an addendum (read: a-them-dumb, because they are) to the Public Ruling that places ridiculous restrictions so that those exemptions that the taxpayers thought should now help in belt-tightening times, are C4-ed into pieces and places far and wide it surprises even this seasoned-getting-used-to-their-idiotic-antics-tax-practitioner.

To explain my rants, let me remind you taxpayers that in Budget 2009, it was announced by the now Defense Minister that employees were meant to be given such goodies as tax exemptions for meal allowances and child care allowances from employers, amongst a slew of exemptions.

The A-Them-Dumb now reads…

Meal allowance provided to an employee for purposes such as overtime or outstation/overseas trips and other similar purposes in exercising his employment is meant to cover meal expenses of the employee. Such meal allowance is paid according to the employee’s position, duties or place where the employment is exercised. As such, any allowance pertaining to meal expenses is chargeable to tax and does not fall under this exemption. Similarly, a per diem allowance which is meant to cover meal expenses for an employee in exercising his employment is also not included in this exemption.

Reality check. A flippin’ two year old would relate a meal allowance to covering meal expenses! Which part of the word “meal” don’t you get in ”meal allowance”?! If it’s not meal expenses, then what? Use the money to buy seeds to cultivate our gardens on our apartment balconies, is it?!

Now, let’s look at how working parents are encouraged to leave their teenagers home alone to join street gangs, lepak and/ or beef up the Mat Rempit population…

For the purpose of this exemption, child means a child of the age of 12 years and below and who is a legitimate child or step-child of an individual or his wife/ husband or a child proved to the satisfaction of the Director General to have been adopted by the individual or his wife/ husband in accordance with any law.

Let’s top off this lump of shit with the fact that the a-them-dumb was issued less than 3 weeks before every employer must submit the details of every one of their employee’s taxable income. Nothing like icing that matches the cake, is there?

Moral switch? Moral switch?!

I can’t take this. Seriously cannot take this.

Here. Read.

What kinda tax parallel can there be to that? Well, the word “guideline” comes to mind. More of how public rulings, those supposed tax authorities’ interpretation of how the tax laws are to be administered are supposed to be merely guidelines – not something that is supposed to be law, even if it stinks like an undead one. Not something that requires you to bare all in your tax returns in declaring whether you are or are not following their guidelines. Not something that factors into whether you are or are not chosen for their “yes, its a random pick” field audit if you ticked the box stating that you’re not a “guideline follower”. Definitely not something that automatic penalty of 45% of tax for underdeclaration is supposed to hit.

So, to non-tax practitioners… having enforceable “guidelines” that requires additional investments in times when money is tight just to achieve “a moral switch” is old hat to us. Welcome to our world. Now allow me to go puke some blood and buy a dryer with my 10 sen petrol savings.

A Child Shall Lead Us

A friend of mine told me to find some tax parallels to the proposal by Datuk Mukhriz Mahathir for the abolishment of the vernacular school system. I can’t. In the midst of reading the news, I found this article instead.

A tax parallel would be Section 82(7) of the Income Tax Act 1967 stating -

Any person who is required by this section to keep records and -

(a) does so electronically shall retain them in an electronically readable form and shall keep the records in such a manner as to enable the records to be readily accessible and convertible into writing; or

(b) has originally kept records in a manual form and subsequently converts those records into an electronic form shall retain those records prior to the conversion in their original form.

What I’d like to know is the point of the second part of that subsection. Why should we spend money to warehouse our old documents for at least 7 freaking years when an electronic version is more reliable, legible in most cases and easily retrievable? Come on, people. In 7 years time, Terengganu school system graduates would just balk at the notion that we still have to wade through boxes of papers just to prove we spent that cash.

One itsy bitsy question was asked… maybe

Since the emergence of that article, I’ve been searching high and low for any references or information on the legislative jurisdiction of the government in controlling prices of fuel to the point of setting it above the market price, i.e. imposing something like a fuel tax on the Rakyat. Now, I’m no expert in what the government can or cannot do, but I’ve always been under the impression that before the government can do anything to that effect, there must first be a proposal made, a Bill drawn up, debate of the Bill, passing of that Bill in Parliament… yadda yadda yadda… gazetting of the Bill, etc before the government is even “authorised” to impose what is effectively a tax. You know, kinda like how they play with excise duty to keep the price of cars beyond the reach of mere mortals… it required the yearly admendments to the indirect tax laws.

Well, I don’t know… which is why I think it’s a good question to ask, don’t you think? 

Anyway, and I think this is another case of bad reporting (am starting to lose count of such occurences, really), the news reporter was probably trying to pose that question to our Domestic Trade and Consumer Affairs Minister. He/ she probably meant to ask that itsy bitsy question about whether the Ministry had authority to fix the price of fuel at above market price. But perhaps the nonsensical answer that came across had to be made to sound intelligent and to the point, which was why that question was probably rephrased on paper (I’m speculating, of course). Anyway, here it is. Read the last sentence in that article… reproduced here -

On controlling the prices of goods, he said the government has the power to control prices through the issuance of licences to suppliers. 

Sorry if I’m not making sense. Petroleum tax is a new animal to my tax vocab.

In theory, it’s supposed to work…

Here’s a question to ponder. Do we really have 6 years statutory limitation?

If you’re in a loss position, you’re open to scrutiny and adjustments by the mighty Board up till six years after you first become tax payable. So, if you happened to be one of those poor shmucks who are down on their luck for seven generations… well, my only advice is try some feng shui.

In the meantime, some salt on that wound.

The new Section 97A says that the Director General may (as opposed to “must”) notify you in writing that you have no assessment by issuing you a Notification of Non-Chargeability, if you happened to be in a loss position for instance.

There’s no time frame set on him to do that, by the way. So, he can sit on it till your tax manager becomes eligible to cash in his retirement benefits for 20 friggin’ years and there’s nothin’ you can do about it. By then, the warehouse in which you stored your documents would’ve been torn down because the leasehold term has expired and there’s nothin’ you can do about it. By then, those documents are already three quarters on their way to full decomposition, so obviously there’s nothin’ you can do about it.

And if by then, he issues you with that Notification, guess what? He’ll expect an answer back in 30 days, failing which he’ll deem his adjustments as final and conclusive. And by then, he can cascade that new (usually massively reduced) loss down to your current years and BANG! BANG! BANG! (sounds better than Form JA! Form JA! Form JA! doesn’t it?)

And there’s nothin’ you can do about it.

I want kill somebody…

ARGH!!

That’s my reply to that IRB officer! ARGH!!!

Franking credits (that’s Section 108 credit for techies) are supposed to be tax that the corporate taxpayers have paid, so they can actually pay franked dividends from. The basic idea is that if you’ve paid the tax (up to 31 December 2007) it’s supposed to count as your franking credits. Yeah, go back to basics, IRBozos! You people gazette the stupid law on 28 December 2007. You people tell us at talks and conferences that taxes that we’ve paid up to 31 December 2007 are creditable into our Section 108 balance. And now Fucking 11 months after that law’s been applied to death, you tell us that prepaid tax instalments don’t count??!! Go read the damn law that you drafted when you had half a brain and go to hell with your stupid interpretation!

Damn you! I hope you rot in perpetual civil servitude!

ARGH!!!

If I threw that registered computer in your face, I’d bet it’ll hurt more than an entire library of Tax Acts!

For those who know what I’m talking about, you’d have boycotted the idiocy behind that “Why Go To The Library When The Library Can Come To You – Virtually” bullshit. For those of you who don’t know what I’m babbling about, run a search on Google with those words. The first result is the site I meant: The most stupid, greedy and misleading advertisement ever! Users should file misrepresentation suits against those greedy bloodsuckers if they were ever dumb enough to renew their subscriptions based on that liar, liar, pants on fire tagline!

Sorry. Need to be constructive. Here’s the solution to our problems, fellow practitioners.

What’s in that 7b package?

Okay, we know that from predominantly savings from fuel subsidies, that’s put 7 big ones into the government’s coffers, which the Finance Minister has committed entirely to stimulating our bearish economy.

So, here’s a take on whether the package is really that stimulating.

Personally, I think this is a case of bad reporting, but I can’t, for the life of me, find out the full details of what makes up that whole RM7b! Here’s the breakdown as much as I could dig out (through cyberspace) -

• RM1.2b will be spent to build 25,000 low cost houses (what kind of stimuli that would be to the Malaysian economy is beyond me… Creation of jobs? Okay, Indonesians can rejoice because there’ll be plenty of construction job openings with the government forking out an average of RM48,000 per house built/ repaired. As for Malaysians, maybe they can now afford that house with their RM30 savings slash spending money per RM1,000 salary… oh wait, weren’t part of our EPF supposed to be accessible anyway to pay mortgages? So, that just means there is nothing addressing the buyers’ side of the 25,000 low cost houses to be built. So, maybe they’ll just end up as mini-white elephants decorating the scenic routes along the North-South Highway, like they always were.)
• RM200m to provide microcredit facilities to help entrepreneurs operating small businesses + RM100m for urban microcredit (okay, I’ll give that a mark of approval for stimulating small businesses. Small steps.)
• RM500m to improve roads in East Malaysia (A little quiz: If a second Penang Bridge… let’s say spanning 3-4 kilometres in length, costs RM4.8b, how much road can RM500m buy you in East Malaysia?)
• RM200m for schools (Headmistresses are rejoicing, according to the newspapers.)
• RM500m for improvement of public transport in major cities (I see potential redefinition to BN cities here… call me pessimistic. Also, remember what happened to that RM400m they promised on the same thing? That’s right. Poof!)
• RM1.5b to set up an investment fund to attract private sector investment (I don’t get this one. If the private sector is supposed to invest into this Valuecap-ish fund, why in the world does the fund need the RM1.5b from the government for?)
• RM400m to expedite the High Speed Broadband project (to expedite? We are already spending RM15b, yes… billion. That was awarded to TM, I think. If 15b doesn’t expedite things, I can’t see how RM400m can.)
• RM500m to upgrade, repair and maintain police stations, living quarters, camps and military quarters (I suppose also to move stations from dangerous areas to safer spots. And then, we can stimulate the Tourism sector by organising tour packages to “cuti-cuti Malaysia yang meningkatkan kadar adrenalin anda”)
• RM600m on minor projects under the public and basic infrastructure project maintenance programme, which includes maintaining village roads, building community halls and small bridges (Okay, we are stimulating the economy… the Indonesian migrant workforce part, that is.)
• RM100m to increase business premises and beautifying and landscaping small towns nationwide (open tender to water them flowers, anyone?)
• RM200m for setting up of pre-school programmes (because in about 12-17 years from now, these little tots will be entering our nation’s workforce. Then, we’ll probably see the multiplier effect of this stimulus injection materialise. That’s right. When we welcome Vision Reality 2020.) 

Okay, that’s RM6b in total, which leaves RM1b unaccounted for. Like I said, its probably just bad reporting, plus the Opposition walk out pretty much overshadowed the contents of that stimulus package, apart from the part of the package that isn’t really part of it anyway because it has to do with asking us to volunteer to reduce our retirement savings. In the grand scheme of all those things, what’s a billion, eh?