IRB demands RM1.5b in extra tax from Najib over RM4b ‘undeclared income’

Datuk Seri Najib Razak had admitted that he did not verify the source of the RM2.6 billion that ended up in his bank account, which had allegedly been siphoned from 1Malaysia Development Bhd. — Picture by Miera Zulyana
Datuk Seri Najib Razak had admitted that he did not verify the source of the RM2.6 billion that ended up in his bank account, which had allegedly been siphoned from 1Malaysia Development Bhd. — Picture by Miera Zulyana

KUALA LUMPUR, April 1 — The Inland Revenue Board (IRB) has reportedly billed Datuk Seri Najib Razak for an extra RM1.5 billion of income tax which it said was due between 2011 and 2017.

The Edge Financial Daily quoted anonymous sources saying Najib had undeclared taxable income of close to RM4 billion during that period — which also included the RM2.6 billion that Najib has insisted was a donation he received from Saudi Arabia.

The letter stating the extra tax was delivered to Najib just over a week ago, it reported.

Malay Mail is currently attempting to verify the report with the IRB and Najib.

Last year, Najib had admitted that he did not verify the source of the RM2.6 billion that ended up in his bank account, which had allegedly been siphoned from 1Malaysia Development Bhd (1MDB).

Speaking to Al Jazeera’s 101 East show, the former prime minister said he had assumed the money was “donations” connected to Saudi Arabia’s King Abdullah bin Abdulaziz Al Saud after the latter gave assurance of his support.

The Edge also quoted tax experts saying donations are subject to income tax, and Najib have committed an offence by not declaring the RM2.6 billion as his income, regardless of the source.

“All incomes are taxable, whether legitimately earned or not,” one tax expert was quoted saying.

“If the income is illegal proceeds, it is up to other agencies like the police or Malaysian Anti-Corruption Commission to investigate if a crime has been committed.

“As far as IRB is concerned, it’s subject to income tax,” he added.

Najib faces dozens of charges of criminal breach of trust, power abuse and money laundering over the use of funds linked to sovereign investment company 1MDB during his tenure as prime minister; seven of them concern SRC International Sdn Bhd.

The SRC International trial is set to begin this Wednesday, after a stay order was lifted by the Federal Court last week.