MCA president Wee Ka Siong has defended his call for the tax appeals system to be reformed, which led to a call for him to be referred to Parliament’s rights and privileges committee.
The Ayer Hitam MP had cited the legal dispute between Tenaga Nasional Bhd and the Inland Revenue Board (LHDN) yesterday when calling for LHDN to be made an independent statutory body reporting to Parliament.
He said such an approach would be a key reform to ensure LHDN was free from political interests or pressure.
TNB is facing a RM5.05 billion tax bill following a Federal Court ruling that it is not eligible to claim reinvestment allowance. The apex court had earlier overturned a Court of Appeal ruling that found TNB to be in the business of manufacturing electricity.
The Federal Court said TNB should actually have been considered a utility company under Schedule 7B of the Income Tax Act 1967 (ITA).
The dispute arose when LHDN disallowed TNB’s claim under Schedule 7A of the ITA on the basis that the generation, distribution and transmission of electricity was not manufacturing of electricity.
In a statement today, Wee said that no one was disputing the court’s ruling that TNB should have applied under Schedule 7B, nor was it about the company’s status as a utility or manufacturer.
“The real issue is the fate of RM5 billion in rakyat’s savings,” he said.
He said what DAP’s Chong Zhemin “conveniently ignores” was that TNB was majority-owned by public savings funds through Amanah Saham Nasional Bhd, EPF, the Retirement Fund Inc (KWAP), Lembaga Tabung Haji and others.
If the government, via LHDN, enforced the court ruling, the RM5 billion would go into its coffers, he said.
He said the law clearly gave the finance minister absolute power to approve TNB’s appeal and re-application under Section 7B to waive the disputed amount.
Yesterday, Wee and Chong, who is the Kampar MP, traded bards in the lower house when Wee claimed that it would be “daylight robbery” if the government decided to enforce the ruling.
This led to Chong claiming that the “daylight robbery” remark was inaccurate, and accused Wee of misleading the house. Chong also demanded Wee retract the claim and threatened to refer him to the rights and privileges committee.
