Govt’s tax recovery action against UTAR is an extreme measure sparking public distrust

Focus Malaysia:

Govt’s tax recovery action against UTAR is an extreme measure sparking public distrust

By Dr Monna Ong Siew Siew

MCA Public Policy and People’s Livelihood Research Advisory Committee urges Prime Minister Datuk Seri Anwar Ibrahim to pay close attention to the latest controversy affecting higher education opportunities, whereby the Inland Revenue Board (LHDN), has slapped Universiti Tunku Abdul Rahman with an RM83 mil demand in back taxes.

The prime minister who is also the Finance Minister needs to take decisive action to withdraw the unreasonable tax recovery directive against UTAR and restore its tax-exempt status to ensure that the university can continue its educational mission without unnecessary financial pressure.

As a non-profit higher education institution that has long provided quality and affordable education, UTAR has contributed greatly towards Malaysia’s human capital by nurturing countless talents.

However, this latest RM83 mil tax recovery and penalties confronting UTAR impose a severe strain to daily operations, demoralises staff, directly impacts the learning environment of its students and weakens the country’s future talent competitiveness.

According to media reports, LHDN re-audited UTAR Education Foundation’s accounts for the past six years and issued this huge tax recovery notice.

For a non-profit educational institution, this action is not only unreasonable but could also lead to difficulties in UTAR’s long-term development.

The government has a responsibility to comprehend and acknowledge the contributions that such institutions render to society, rather than target them with punitive tax measures.

What is even more disconcerting is that this tax recovery action is not limited to UTAR; other charitable organisations, private hospitals, non-governmental organisations, and religious groups are also confronted with similar pressure.

Such actions not only undermine the operational capabilities of social welfare organisations but also erode public confidence in the government’s support for public services.

Education is the foundation of national development, and non-profit educational institutions play a crucial role in this process.

The government should not weaken their operations by imposing tax burdens but instead, support them through policies to ensure that they can continue to nurture future talents for the country.

We earnestly implore on the prime minister to take immediate action, demonstrate the government’s commitment to education, and ensure that non-profit higher education institutions are not disrupted by unreasonable tax recoveries. This will allow educational resources to continue serving its citizens and advance the nation. – Oct 4, 2024



Dr Monna Ong Siew Siew is the Public Policy and People’s Livelihood Research Advisory Committee chairperson as well as the MCA Terengganu state liaison committee chairperson.