What's Happening?
The Inland Revenue Board (IRB) of Malaysia has announced that it will not impose penalties during the first year of the Self-Assessment Stamp Duty System (STSDS), which is set to be implemented on January
1. This decision aims to provide the public with ample time to adapt to the new system. The STSDS will initially cover general stamping instruments, securities, and rental or lease agreements. Taxpayers will be required to complete the stamp duty return form through the e-Duti Setem (e-DS) system, which includes a calculation formula to assist in determining the stamp duty. The IRB has emphasized that no penalties will be imposed for incorrect submissions during this initial phase. All stamping applications must be submitted through the MyTax portal to ensure data security and better coordination of tax-related matters. The existing method of paying stamp duty remains unchanged, with payments continuing to be made online through the FPX platform.
Why It's Important?
The introduction of the STSDS represents a significant shift in how stamp duties are assessed and paid, moving towards a more self-regulated system. This change is crucial as it reflects a broader trend towards digitalization and self-assessment in tax systems, which can lead to increased efficiency and reduced administrative burdens. By waiving penalties in the first year, the IRB is encouraging taxpayers to familiarize themselves with the new system without the fear of immediate repercussions for errors. This approach may foster greater compliance and understanding among taxpayers, ultimately leading to a smoother transition and more accurate tax reporting. The move also highlights the importance of digital platforms in modernizing tax administration, which could serve as a model for other countries considering similar reforms.
What's Next?
As the STSDS is implemented, the IRB will likely monitor its effectiveness and gather feedback from users to make necessary adjustments. The trial access to the e-DS system via the MyTax portal, available from December 17 to 31, is an opportunity for users to explore and test the system, potentially leading to improvements based on user experience. The IRB may also conduct educational campaigns or provide additional resources to assist taxpayers in understanding and navigating the new system. In the long term, the success of the STSDS could influence further digitalization efforts within the IRB and other government agencies, promoting a more streamlined and user-friendly approach to tax administration.
