University of New South Wales Faculty of Law Research Series
Last Updated: 1 December 2010
Performance of the Indirect Tax Administration in Malaysia:
A Comparison with International Benchmarks
This paper was published in Datt, K., Tran-Nam, B. and Bain, K. (eds.), International Tax Administration: Building Bridges, Sydney: CCH, pp. 239-273.
This study critically evaluates the performance of the indirect tax administration in Malaysia using international benchmarks by means of document analyses of published and unpublished sources and a taxpayer survey. It is found that 14 out of 48 tax administrative tasks examined are below the international benchmarks. The top five areas of concern are; enforcement, payment and collection, information technology, tax personnel management, and sanction and penalty. It is discovered that most of these problems are attributable to lack of resources. The result of the taxpayer survey indicates that the quality of the service provided by the Malaysian indirect tax administrators is only moderate. The policy implication of this study is that further resources (both in terms of capital and human resources) should be made available to the Malaysian indirect tax administrators so that they can improve the quality of their service to the taxpayers and perform their tax administrative tasks in an efficient and effective manner.
[∗] Muzainah Mansor is a senior lecturer at Universiti Utara Malaysia and currently a PhD candidate at the Australian School of Taxation (Atax), Faculty of Law, UNSW, Sydney, Australia.