The Income Tax (Deduction from Remuneration) (Amendment) Rules 2023 [P.U. (A) 230/2023] (Amendment Rules) was gazetted on 31 July 2023 and came into operation on 1 August 2023.
The Amendment Rules amend the Income Tax (Deduction from Remuneration) Rules 1994 [P.U. (A) 507/1994] (Principal Rules) by substituting Table 1 in Paragraph 4(1) of the Schedule in the Principal Rules with the following table:
"Table 1: Value of P,M,R and B"
P (RM) |
M (RM) |
R (%) |
B Catergory 1& 3 (RM) |
B Catergory 2 (RM) |
5,0001 - 20,000 | 5,000 | 1 | -400 | -800 |
20,001 - 35,000 | 20,000 | 3 | -250 | -650 |
35,001 - 50,000 | 35,000 | 6 | 600 | 600 |
50,001 - 70,000 | 50,000 | 11 | 1,500 | 1,500 |
70,001 - 100,000 | 70,000 | 19 | 3,700 | 3,700 |
100,001 - 400,000 | 100,000 | 25 | 9,400 | 9,400 |
400,001 - 600,000 | 400,000 | 26 | 84,400 | 84,400 |
600,001 - 2,000,000 | 600,000 | 28 | 136,400 | 136,400 |
Exceeding 2,000,000 | 2,000,000 | 30 | 528,400 | 528,400 |
It is noted that the Inland Revenue Board of Malaysia (HASiL) responded on 7 July 2023 in the Joint Memorandum on Issues Arising from 2023 Budget Speech & Finance Bill 2023 (item (a) on page 10) that the new tax rates to calculate the monthly tax deduction (MTD) would come into operation on 1 June 2023. This would be by an amendment to the Principal Rules following the gazette of the Finance Act 2023 on 31 May 2023. The operational date of 1 June 2023 was also announced on HASiL’s website in June 2023.
References:
1. Income Tax (Deduction from Remuneration) (Amendment) Rules 2023 [P.U. (A) 230/2023].