PETALING JAYA, Jan 22 — Companies that have not  registered for the implementation of the Goods and Services Tax (GST) following the December 31, 2014 deadline will be forcibly registered starting next month.

GST director Datuk Subromaniam Tholasy said this measure would be taken to ensure all eligible companies were registered by April 1, the date the GST would come into force.

In his revised Budget 2015 announcement on Tuesday, Prime Minister Datuk Seri Najib Razak said only 304,444 companies had registered for the tax — slightly more than half of the number eligible for the tax.

Subromaniam said about 70 per cent of those who registered were from the retail and service industries. 

“The bulk of the rest are wholesalers, B2Bs (business-to-business) and those in the manufacturing industry,” he said

Although there are about 1.13 million companies registered with the Companies Commission of Malaysia, only about 500,000 are eligible for the GST. 

“One cannot just look at the total number of registered firms, as the nature of their operations determines their eligibility for the tax,” he said. 

“Only about half a million of these firms are actually involved in producing taxable supplies.”

Royal Malaysian Customs director-general Datuk Seri Khazali Ahmad said the department had identified more than 50,000 companies and individuals that generated income exceeding RM500,000 annually which had not registered for the GST. 

“We will issue notices to the companies and individuals to register within 14 days of the notice,” he said. 

“Should they fail to do so, we will impose forcible registration under Section 21(5) of the Goods and Services Tax Act 2014.”

The registration period was from June to December 31 last year.

“We urge businesses and individuals who have not registered to immediately do so as forcible registration will begin in February,” he said. 

The Finance Ministry would impose a graduated penalty scheme in which fines would increase by RM50 every 20 days. 

From yesterday to Feb 9, the penalty for delay in registering would be RM150 a day.  Following that, the penalty would increase to RM200 a day until March 1. 

That means a company that registers on March 1 would need to pay a penalty of RM9,000. 

Likewise, those that sign up on March 21 be charged a RM14,000 penalty.

The maximum penalty would be enforced from March 25, which would see latecomers paying RM15,000.