In an effort to expand the tax base progressively, the government has proposed the introduction of a new dividend tax on individuals who earn more than RM100,000 in dividends annually.
According to Prime Minister Dato’ Seri Anwar Ibrahim, this proposed tax is designed so that income tax collection is not only dependent on salary earners, but also covers income from individuals with high shareholdings – at the threshold of RM100,000 in dividend income, this will only cover those with shareholdings worth millions of Ringgit.
This proposal, if approved by Parliament, will be enforced from YA 2025. In addition, there will be considerations to exempt dividend income from avenues like EPF, PNB funds, and dividend income from overseas shareholdings.
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