Malaysia Imposes Travel Ban On Those Who Fail To Settle Their GST
Traders who fail to pay the Goods and Services Tax (GST) will be blacklisted from going abroad, the Royal Malaysian Customs Department has said.
The Malaysian government recently announced that it will blacklist all traders who fail to pay the Goods and Services Tax (GST) from going abroad.
Announcing this, their Customs director-general, Datuk Subromaniam Tholasy said 7,143 traders were currently blacklisted for failing to pass on the consumption tax collected from consumers to his department.
“We have since barred these traders from travelling at all exit points in the country.
“Traders who have yet to clear the GST amounts owed should visit Customs offices before going abroad to check if they have been blacklisted,” he said.
According to him, once a particular trader has settled his GST, the department would request his name to be removed from the blacklist.
It was also reported that the Malaysian Federation of Chinese Associations (Huazong) president Tan Sri Pheng Yin Huah had earlier complained that the government’s travel ban on traders suspected of defaulting on GST was without prior notice.
This, he said had prompted disapproval from traders, citing an example where a Sarawakian businessman had only found out an hour before his flight about the travel ban on him over overdue GST.
To make matters worst, he said Customs officers at the airport were unable to tell him the amount owed.
He said the businessman paid the outstanding amount of RM2,739.04 on the same day after checking with his company directors, but was still disallowed from flying as the travel ban could allegedly only be lifted if clearance from Putrajaya was given.
Meanwhile, Immigration director-general Datuk Seri Mustafar Ali said his department merely followed instructions from other agencies and even court orders when imposing the travel ban on Malaysians.
He said the Immigration Department did not differentiate what tax it and will impose the restrictions as required.
“So long as someone defaults on national tax revenue, whether it is personal income tax, corporate tax or GST, as long as the relevant body requests Immigration Department to impose restrictions, Immigration Department will implement according to instructions,” he said.
He said those currently barred from exiting the country were mostly those who were bankrupt, who have yet to settle their taxes owed to the Inland Revenue Board or had defaulted on the federal government’s higher education study loan.
The Malaysian Home Ministry said earlier this year said a total 622,768 individuals have been blacklisted from going abroad during the 2010 to 2017 period.
The ministry had then said the blacklisted cases involved various government agencies such as the Inland Revenue Board, the Malaysia Department of Insolvency, Employees’ Provident Fund, the Malaysian Anti-Corruption Commission, the police, the Customs Department and Bank Negara Malaysia.
Under the Goods and Services Tax Act 2014’s Section 49, the Customs and Excise director-general may issue a notice to the Immigration director to ask that a person be barred from leaving the country, if he believes the person will leave without paying taxes due.
The same Section 49 states that the Customs director-general shall cause the notice to be served personally on or to be sent via registered post to the affected person, it said all actions taken under this provision would still remain valid even if the affected person did not receive notice.
Among other things, the provision said that a written statement by the Customs director-general stating that the overdue tax has been paid would be “sufficient authority” to allow the affected individual to leave Malaysia.