KUALA LUMPUR, April 18 — The oil and gas (O&G) sector is likely to see a recovery on all fronts this year, having seen its earnings trough in 2017, said RHB Research Institute. In its strategy note focusing on Malaysia, the research firm said…
MUMBAI, April 18 — India’s government and the central bank said yesterday they will ensure there is an adequate amount of cash in circulation, following reports that banks’ automated teller machines (ATMs) had run out of notes in different parts…
KUALA LUMPUR: Imposing withholding tax on businesses in the digital economy could be the best option at a time when Malaysia wants to capture higher taxes on e-commerce transactions, according to tax experts.
Grant Thornton Malaysia’s head of tax advisory and international tax Daniel Woo said the withholding tax mechanism ideally should be the final tax but option should be allowed to register and file for net taxation.
“The current withholding tax provision may also need some adaptation, if not it cannot cover properly and not relevant to the digital economy,” he said at the Malaysian Tax Conference 2018 organised by the Malaysian Institute of Accountants and the Malaysian Association of Tax Accountants today.
The Inland Revenue Board’s (IRB) e-commerce division director Abdul Aziz Kechik concurred, saying that it is the best option for the time being.
“For withholding tax, they (businesses) don’t need to submit anything and we can straightaway tax them. With digitalisation, we want to broaden the withholding tax scope.”
He said IRB is still reviewing the e-commerce guidelines, but declined to comment further.
Woo opined the ideal withholding tax rate is between 10% and 15%.
“You cannot set too high or too low. If it is too high, the people will find ways to avoid it.”
He highlighted that the tax authority cannot take a general approach to impose the withholding tax on digital transactions, failing which will hinder the digital economy development.”
“We need to look at the conceptual and practical aspects in applying the withholding tax.”
With the imposition of withholding tax, foreign businesses must register with the local tax authority so that they can claim the credit to their home countries.
Meanwhile, IRB CEO Datuk Seri Sabin Samitah earlier said in his keynote address that the tax authority will strike a balance between supporting the new emerging digital economy and at the same time ensuring the right to tax and collect the right amount of tax.
“Tax authorities are looking at the best mechanism to tackle the (digital economy) issue, with the primary objective of safeguarding the tax base and revenue due to the country.”
The digital economy is projected to account for 45% of Malaysia’s gross domestic product by 2021 against a mere 7% in 2017.
Sabin also said that IRB is expected to contribute 42.6% to the country’s total budget needed this year, which translates into RM134.71 billion as announced in Budget 2018.
LONDON, April 16 ― Gold and oil traded slightly lower as markets opened for the first time since Western powers launched a missile attack on Syria, but equities are unlikely to experience big losses unless the West strikes again or Russia…
NEW YORK: European stocks ran into profit-taking Friday as many investors, wary of global uncertainty and US President Donald Trump's volatile Twitter diplomacy, cashed out before the weekend, traders said.
Bourses in Paris and Frankfurt had posted solid gains earlier in the session after Trump put off a decision about military strikes in Syria, giving investor nerves a welcome break.
Although tensions appeared to be easing, few dared to carry positions into the weekend, fearing they may regret it come Monday morning. Equity markets in Europe finished with modest gains.
“Traders remain cautious heading into the weekend,” said Craig Erlam at OANDA. “Given the backdrop of a trade conflict with China and rising tensions with Russia over Syria, any rallies may be somewhat gradual”.
Despite the lackluster ending to the week, European markets “have pulled off a third straight week of gains”, said Jasper Lawler at LCG, crediting “Trump Twitter fatigue” for the overall resilience of equity markets.
US stocks opened in positive territory but quickly were under pressure after a batch of earnings reports from large US banks sparked a selloff in financial shares.
Although earnings from JPMorgan Chase and other large banks bested analyst expectations, the sector had risen in anticipation of the reports and the results — while good — were not strong enough to propel the stocks higher, analysts said.
“You had a sector selloff in financials,” said Art Hogan, chief market strategist at Wunderlich Securities. “When the group started selling off, it took the whole market with it”.
“It feels like we just ramped up expectations too much,” he added.
US earnings season picks up momentum next week with results from other large banks, as well as from General Electric, Netflix and others.
Analysts are hoping a successful US corporate earnings season will lift US stocks following a rocky period.
The market has been pressured by fears of a trade war, concerns about higher US interest rates and worries about the Trump administration's prospects following myriad controversies and the near-constant churn of White House staff.
Among other markets, oil prices finished at fresh three-year highs after a report by the International Energy Agency highlighted turbulence in Syria in the oil-rich Middle East and the effectiveness of a deal between OPEC and Russia to limit output.
Key figures around 2100 GMT, (5am Malaysia time)
New York – Dow: DOWN 0.5% at 24,360.14 (close)
New York – S&P 500: DOWN 0.3% at 2,656.30 (close)
New York – Nasdaq: DOWN 0.5% at 7,106.65 (close)
London – FTSE 100: UP 0.1% at 7,264.56 (close)
Frankfurt – DAX 30: UP 0.2% at 12,442.40 (close)
Paris – CAC 40: UP 0.1% at 5,315.02 (close)
EURO STOXX 50: UP 0.2% at 3,448.12 (close)
Tokyo – Nikkei 225: UP 0.6% at 21,778.74 (close)
Hong Kong – Hang Seng: DOWN 0.1% at 30,808.38 (close)
Shanghai – Composite: DOWN 0.7% at 3,159.05 (close)
Euro/dollar: UP at US$1.2338 from US$1.2327 at 2100 GMT
Dollar/yen: UP at 107.35 yen from 107.33
Pound/dollar: UP at US$1.4241 from US$1.4228
Oil – Brent North Sea: UP 56 cents at US$72.58 per barrel
Oil – West Texas Intermediate: UP 32 cents at US$67.39 per barrel — AFP
US$1 = RM3.87
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Sacofa Sdn Bhd (Sacofa), Sarawak’s leading telecommunications infrastructure company, has an important part to play in the state’s journey towards developing the digital economy here. Sacofa was incorporated on July 11, 2001 with the primary objectives to build and expand the provision of telecommunication network infrastructures throughout Sarawak. To facilitate Sacofa in achieving its objectives, […]