Government Policy >>>

One more BN racial discrimination policy

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I received a viral email about the donkeyland’s tax deduction issue for donation given to religious institutions for bumi and non-bumi tax payers.

Muslims pay zakat which is used entirely for Muslim community while taxes from non-bumi are mainly used for NEP-related projects like building MARA Universities, JPA scholarships, etc for bumi.

Donation to temple or church and Zakat Calculated Differently for tax purposes

When non-Malays do their religious obligations, it is NOT tax deductable unless the Church or temple has applied and obtained the approval for tax exemption, which is normally very stringent and seldom approved..

Even if approved the donation is restriced to 7% of your aggregate income.

(This has been revised to 10% from YA 2009 for company.)

Whereas zakat qualifies for 100% and is deducted from the tax liability.

An Example:

Ah Chong donates to temple or Church: RM10,000.

His Annual income: RM100,000.

Tax Relief: RM23,000 (For Individual) + RM 7,000 (For Donation)

Chargeable income: RM70,000

Tax payable: RM7,125

Ahmad – same income and relief

Chargeable income : (RM100,000 – RM23,000) = RM77,000

Tax payable: (RM7125 + 1680) = RM8,805

Less zakat: RM 10,000

Tax refundable: RM (1,195)

Ah […]