Malaysia introduces Tax Corporate Governance Framework

On 11 April 2022, the MIRB released a Tax Corporate Governance Framework with the aim to provide greater certainty of tax compliance, earlier resolution of tax issues and better transparency for multination companies.

Expectations

The framework provides IRBM´s expectation on applying Tax Corporate Governance with the principles of a good Tax Corporate Governance:

Tax Strategy Established
Applied Comprehensively
Responsibility Assigned
Governance Documented
Testing Performed
Assurance Provided.

Applicability

This framework is suitable for all sizes of business, especially businesses that prioritized corporate governance matters. By having such framework, organizations may benefit from better tax risk management, protect their reputation and reduce penalty due to non-compliance.

Key elements

The tax control framework provides a system to identify, overcome, control and report any tax risks. Each organization will have a different framework depending on the indidvidual business nature. Below please find the key elements of the tax control framework:

Strategic tax control
Tax management control
Tax operation control
Reporting and continuous monitoring

The MIRB will conduct reviews for participating organization. Organizations that passed the review will qualify for the benefits of the program, and the organization will not be subject to audit or investigation.