Flexibility between market-led and government-led economies

The 1997-98 East Asia financial crisis has raised doubts over the roles of two economic-systems: market-led and government-led economies. This paper deliberates on the two opposing economic systems: the choice of which are continually debated. There is a need for governments to look at economic flexibility and determine whether the countries affected by the financial crisis could reposition themselves fast enough. More specifically, this paper evaluates the performance of government-led economies such as those in Malaysia,Singapore, Thailand, Philippines, and Indonesia when compared to marketled economies as practised in the United Kingdom, United States, and Japan.A compilation of an index method based on Angresano (1996) consisting of the quantitative performance measure for an identified country was computed over the average period 1980-2003. The findings of this study suggest that the approaches to a market-led or government-led economy is a matter of degree and are not mutually exclusive

Flexibility between Market-Led and Government-Led Economies

The 1997-98 East Asia financial crisis has raised doubts over the roles of two economic-systems: market-led and government-led economies. This paper deliberates on the two opposing economic systems: the choice of which are continually debated. There is a need for governments to look at economic flexibility and determine whether the countries affected by the financial crisis could reposition themselves fast enough. More specifically, this paper evaluates the performance of government-led economies such as those in Malaysia, Singapore, Thailand, Philippines, and Indonesia when compared to marketled economies as practised in the United Kingdom, United States, and Japan. A compilation of an index method based on Angresano (1996) consisting of the quantitative performance measure for an identified country was computed over the average period 1980-2003. The findings of this study suggest that the approaches to a market-led or government-led economy is a matter of degree and are not mutually exclusive.

Compliance costs of Malaysia's small and medium enterprises

This study presents compliance costs of Malaysia's Small and Medium Enterprises (SMEs) for the income tax assessment year 1998.These estimates obtained from a representative population using personal interviews suggest that the level of compliance costs, which are made of computational and planning costs is substantially greater for SMEs compared to public listed companies.For instance, the average tax paid by the SMEs is merely one-eleventh of the taxes paid by a typical listed firm.The average tax paid by the SMEs is merely one-eleventh of the taxes paid by a typical SME. This indicates that the compliance cost is three and a half times more regressive for an average SME. The study is particularly significant for Malaysian taxpayers (including SMEs) as the self-assessment system will be implemented in stages, commencing with companies, in 2001

Tax professionals' views on self assessment system

Malaysia has adopted an Official Assessment System (OAS) whereby taxpayers were assessed by the tax authorities based on the tax returns filled by them. The Malaysian Government has introduced a Self Assessment System (SAS) in stages commencing with companies from 2001. This new strategy require taxpayers to take more responsibility for getting their tax returns correct, since the information which they furnish in their returns will be accepted at face value by the Inland Revenue Board (IRB). The IRB, however, will audit some cases at random and if it has inaccurate information, the taxpayers concerned will be liable for prosecution.This survey focuses on the role of tax professionals under SAS. The findings of the survey reports on tax professionals' views and level of preparation towards the implementation of SAS in Malaysia. The findings also report on problems faced by tax professionals under the existing official assessment tax system and seek to ascertain tax professionals' perception towards the introduction of the new assessment system. Finally, the data provides some input on the preparatory measures to be undertaken by the IRB to facilitate tax practitioners' role in enhancing tax compliance under the new assessment system

Travel Demand Management: Lessons for Malaysia

The growth in the number of motor vehicles has exacted costs on both the Malaysian economy and environment. For reasons such as increasing disposable incomes and poor management of the public transportation system, the number of vehicles has grown unabated and, in fact, is aided by various contradictory policy measures such as national car projects and the existence of fuel subsidies. A phased, five-pronged Transport Development Management-based approach is recommended towards targeting a sustainable transportation system in Malaysia: (1) alteration of charges on road taxes and car insurance, (2) elimination of fuel subsidies, (3) imposition of fuel taxes and amendments in the bases for car taxation, (4) congestion charging, particularly in Kuala Lumpur, and (5) national road pricing. This move towards an eventual sustainable transportation system is presented for consideration

Travel Demand Management: Lessons for Malaysia

The growth in the number of motor vehicles has exacted costs on both the Malaysian economy and environment. For reasons such as increasing disposable incomes and poor management of the public transportation system, the number of vehicles has grown unabated and, in fact, is aided by various contradictory policy measures such as national car projects and the existence of fuel subsidies. A phased, five-pronged Transport Development Management-based approach is recommended towards targeting a sustainable transportation system in Malaysia: (1) alteration of charges on road taxes and car insurance, (2) elimination of fuel subsidies, (3) imposition of fuel taxes and amendments in the bases for car taxation, (4) congestion charging, particularly in Kuala Lumpur, and (5) national road pricing. This move towards an eventual sustainable transportation system is presented for consideration

Global electronic commerce: Tax issues

The sudden surge in the use of electronic commerce has facilitated the communication and exchange of information at an unprecedented level.Although the brisk development of e-commerce is more apparent in developed countries, Malaysia is not far behind.E-commerce is the symbiotic integration of communications, data management, and security capabilities to allow business applications within different organizations to automatically exchange information related to the sale of goods and services. E-commerce, therefore, combines the advantages of computer-based processing (speed, reliability. and relatively high volumes of data) with the advantages of people-based insight (creativity, flexibility and adaptability).E-commerce also enables entrepreneurs to review, analyze. add value, and sell a variety of - products that are represented electronically, such as reference material, textbooks and training materials, and computer sofware.The World Trade Organization (WTO) has reported that 51 percent of global trade was transacted through facsimile and telephone while 17 percent was conducted through the lnternet and the balance by other means.The WTO further estimated that global revenues from Internet commerce could be USS2OO billion a year by the turn of the century and grow briskly after that.By the year 2005, one billion people are expected to be on-line (NST, 1998).A preliminary survey conducted by the authors in the northern region of West Malaysia shows that most consumers and retailers arc aware of the use of lnternet for the purposes of commerce.About 60 percent of the consumers expressed their concern regarding the Internet security issue such as possible fraud, security infraction, counterfeiting, and privacy issues. This paper examines how electronic commerce would have an impact on the Malaysian income tax system.Since e-commerce would be an important 'trade route' in the next millenium, tax administrators need to be concerned of the possible loss of revenue due to competition among countries. Moreover, electronic forms of money would provide opportunities and even loopholes for tax evasion.Tax authorities all over the world. therefore, will have to realise that traditional tax rules may have to be modified or adjusted to take account of borderless commerce

Tax expenditure reporting: towards a more transparent government budget

Tax expenditures are a substitute to government direct spending. Therefore, they should be reported and analysed on the spending side of the budget. Failure to understand the concept of tax expenditures would lead to tax expenditures being mistakenly analysed as the revenue function and escaped the detailed scrutiny that should have been placed on direct spending. This article explores the concept of tax expenditures as posited by the late Professor Stanley S Surrey. It also discusses the arguments that oppose and support the use of tax expenditures, and the different methods that can be applied to measure tax expenditures in monetary terms. Finally, this article discusses the importance of tax expenditure reporting from a revenue perspective and outlines the steps involved in the preparation of a tax expenditure report