The Silly-Billy Calculation – Malaysian Chinese Pay 90% Taxes. Really? 

Dr Wan Nor: I am writing this because I believe that if we wish to truly become Bangsa Malaysia, then the truth must be told and the lies must be exposed and abandoned.

This silly calculation may help to expose a manipulative lie of the elites.

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The Silly-Billy Calculation – Malaysian Chinese Pay 90% Taxes. Really? 

The General Argument of the Man in the Street 

We often hear that Chinese are said to pay ~90% of the taxes [Source: Wiki and general talk in the streets]. This statement is often made to give the impression that there is only race that ensures economic survival of our country. It also tries to imply the significance and value of this race vis-à-vis other races. It is a supremacist statement meant to denigrate other races, and meant to classify the races, thus divisive in its nature.

What does this 90% represent?

This represents ~24% of their DECLARED income. This tax (24%) goes to national budget including the scholarships, budget for all the schools and universities. Can you imagine what 76% would represent? Can you imagine what the elite Malaysian Chinese businessmen could afford for their own people if they chose to? 

Demonstration – The Silly-Billy Calculation

I would like to play around with these numbers and assumptions. I present three cases.

CASE 1: On the General Assumption that 90% Tax is paid by Chinese. 

Let’s do a simple calculation:
National Budget 2018: RM280.25 Billion
Total Population Malaysia: 31,381,992 (July 2017 est)
Chinese Population: 20.8%  6,527,454.3 
90% Budget 2018: RM252.225 Billion  24% Income Declared (Chinese)
 76% Income Declared (Chinese retained)  Income After Tax  RM798.7125 Billion

Thus, for ALL Chinese Aged > 0 years
Income Per Population  RM122,362/year  RM10,196.84 / month (AFTER TAX)

Of course, we know that there are struggling Bangsa Malaysia of Chinese origin. So, something is not quite right! And that would imply that the average is in fact polarized with a gap between the two polarities of struggling Malaysian Chinese and, what I would call, elitist Chinese Malaysians.

Thus, is this not a clear indication of the huge gap between the elitist group and the rest? It would also suggest that not all Chinese fall into the category of this elitist Chinese group of Malaysians.

Also, at this point, I think it is necessary to ask thus why the Chinese Independent High Schools (SMPC-Sekolah Menengah Persendirian Cina) are now offered an allocation and financial support, in priority over other critical educational needs? They obviously have the means to develop more and better that what we are developing. Did we not say that we wish to prioritise the needy? 

CASE 2: Let’s take this Further with a Few More Details and Assumptions and Rework the Silly-Billy Calculation. 

Thus, the deficit is RM40 Billion

Of the RM240 Billion revenue:
Personal Income Tax Contributes RM32 Billion 
Corporate Taxes Contribute RM72 Billion
The rest comes from GST, import tax / duties, etc: RM136 Billion

Thus
With a Chinese workforce of 60% ~ 3,916,472
90% Contribution to Personal Income Tax: 90% of RM32B ~RM28.8 Billion
60% Contribution (Let’s say) Corporate Taxes: 60% of RM72B ~ RM43.2 Billion 

Yields 
Total Contribution of RM72B which represents 24% Income Declared
Total Income Declared 100% – RM300 Billion
Total Income After Tax: RM228 Billion
Average Distributed over Chinese Workforce: RM58,215.65/year or RM4,851.3

CASE 3: ON THE GENERAL ASSUMPTION THAT 90% TAX IS PAID BY CHINESE (PERSONAL AND CORPORATE)

Thus
With a Chinese workforce of 60% ~ 3,916,472
90% Contribution to Personal Income Tax: 90% of RM32B ~RM28.8 Billion
90% Contribution (Let’s say) Corporate Taxes: 90% of RM72B ~ RM64.8 Billion 

Yields 
Total Contribution of RM93.6 Billion which represents 24% Income Declared
Total Income Declared 100% – RM390.0 Billion
Total Income After Tax (76%): RM296.4 Billion
Distribution over Chinese Workforce: RM75,680.35 / year or RM6,306.70 / month

Conclusion

Yes, I know the Silly-Billy calculations are silly. But these calculations allow us to state that:

• The supremacist “90% statement” is often made to give the impression that there is only race that ensures economic survival of our country, i.e. the Chinese, is most probably wrong. In fact I would say it is NOT the truth.
• This supremacist “90% statement” that tries to imply the significance and value of this race vis-à-vis other races is not based on facts, thus should be exposed as a supremacist statement meant to denigrate other races, and meant to classify the races, thus divisive in its nature. It is NOT the truth
• The general statement in Wikipedia that “90% of the tax is contributed by the Chinese Malaysians” and that “of the 1.34 million Malaysian citizens paying taxes, almost 90% of these are non-Malays, with most of them Chinese Malaysians”[Wikipedia] is very misleading. It is not the truth.
• This claim is amongst many tactics that ensure that the elites hold the reigns, stopping the moderates from gaining ground. It keeps the struggling moderate Malaysians of Chinese roots, struggling. It keeps the Malaysians of Malay roots believing the false perception that they have achieved nothing. 

If we wish to truly become Bangsa Malaysia, then the truth must be told and the lies must be exposed and abandoned.

NOTE: 
Source: Wikipedia on “Malaysian Chinese”; Section: Taxpayer
Chinese are the largest taxpayers among the three ethnic groups in Malaysia. According to the Malaysian Prime Minister Najib Razak in 2014, only one in ten of the total workforce pay any income tax.[175] The former law minister Datuk Zaid Ibrahim further indicated that Chinese pay more tax than Malays.[176] It’s been claimed that of the 1.34 million Malaysian citizens paying taxes, almost 90% of these are non-Malays, with most of them Chinese Malaysians.[177]

Disclaimer: This author/scientist is not good at math and welcomes other assumptions.

(The views expressed are those of the contributor)

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Wan Nor writes under the byline, “Hard Questions By Wan Nor”.

Wan Nor, PhD, scientist, born and raised in Britain. Through her deep sense of commitment to Malaysia, she seeks workable solutions in this climate of uncertainty and, at times, hopelessness.

For her full profile, please see this link.