Police must immediately investigate whether there is any misappropriation or abuse of power regarding the missing RM50 Million allocation under budget 2016 to Chinese Primary schools

DAP Perak has today lodged a police report regarding the missing RM50 Million allocation under budget 2016 to Chinese Primary schools.

According to the news report in China Press today, Finance Ministry has confirmed that the full allocation has been disbursed to the Education Ministry. However, the Education Ministry denied receiving the full RM50 Million allocation.

I have lodged a police report at IPD Ipoh this morning to urge the police to investigate whether there is any misappropriation or abuse of power regarding the missing RM50 Million allocation to Chinese Primary Schools.

It is unacceptable that when there is just 8 days remaining in 2016, 800 Chinese Primary Schools throughout the country has yet to receive a single cent of allocation. The same has happened last year when RM30 million of the allocation to the Chinese Primary Schools has been use for flood relief purposes.

In 2013 and 2014, no such cases were reported. All the RM50 Million allocation promised to Chinese Primary Schools were disbursed in full. However, after MCA rejoined the cabinet, problems start arising. In two consecutive years, during 2014 and 2015 allocations to the Chinese Primary Schools have been reportedly missing.

MCA’s saying “When you have someone in the government, things get done.”(有人在朝好办事) is nothing more than an empty slogan. I urge MCA to stop using such tactics to deceive the people. It has been proven over time, with MCA in the cabinet, more problem arises.

I also urge the police to investigate the missing allocation of RM25 Million to SMJK schools and RM50 Million to Catholic Schools.

Media Statement by Chong Zhemin, Political Secretary to DAP Perak Chairman and DAP Perak Publicity Bureau Chief on 23 Dec 2016

Is Liow Tiong Lai or Fadillah Yusof lying about the ECRL cost increase from RM30 Billion to RM55 Billion? Time for BN to come clean on the reason of the RM25 Billion cost increase and deny that the money will be used to bailed out 1MDB debts.

Transport Minister Liow Tiong Lai yesterday explained that the East Coast Rail Link(ECRL) cost increase from RM30 Billion to RM55 Billion is partly due to the fall in Ringgit. Liow said the figures cited in the project’s feasibility study was based on 2009-2010 exchange rates.

He was reported saying “That time dollar is only RM3.2 to a dollar, now its RM4.2 and gone up to RM4.5.”

Works minister Fadillah Yusof has as recent as 27 July 2016, denied a report by Sarawak Report that the ECRL cost will be inflated from RM30 Billion to RM60 Billion to pay off 1MDB debts. He also denied that the increment in cost was discussed in cabinet.

What had happened in the span of 3 months that the cost of ECRL has almost doubled from RM30 Billion to RM55 Billion? Is Liow Tiong Lai or Fadillah Yusof lying? Both of them cannot be telling the truth on the RM25 Billion cost increase in ECRL.

If Liow is telling the truth, Fadillah Yusof denial that the ECRL cost will increase from RM30 Billion to Rm 60 Billion will be a big lie. The BN cabinet will also be one of the most incompetent and substandard cabinet in the world as three months before the signing of a multi-billion agreement, the cabinet is still unaware that the cost is calculated based on the exchange rate of 2009-2010 and subject to increase.

If Fadillah is telling the truth in July by denying the ECRL cost will be inflated from RM30 Billion to RM 60 Billion then Liow’s “exchange rate” explanation will be expose as a lie.

I urge Liow and Fadillah to both come forward and clarify as both of their version of explanation contradicts each other. It is time for Barisan National to come clean on the increment of the cost of ECRL.

Malaysians deserve to know why in the span of 3 months the cost of ECRL was inflated from RM30 Billion to RM55 Billion. Will the inflated amount be used to bail out 1MDB debts?

BN must come clean on the reason of the RM25 Billion cost increase and deny that the money will be used to bailed out 1MDB debts.

Media Statement by Chong Zhemin, DAP Perak Economic Developement Bureau Chief and Political Secretary to Taiping MP on 3 Nov 2016

Najib must explain why did he award the RM55 Billion East Coast Rail Link to China Communications Construction Company(CCCC) Limited, when CCCC was debarred by World Bank for fraudulent practices until January 12, 2017.

Najib has announced that the RM55 Billion East Coast Rail Link will be built and financed by China with the construction contract awarded to China Communications Construction Company, while a financing agreement will be signed with Export-Import Bank of China.

Najib must explain why did he award the RM55 Billion East Coast Rail Link(ECRL) contract which has almost doubled in price without open tender to a company that is dubious, questionable and engaged in fraudulent practices.

Firstly, the ECRL which was initially touted to be RM30 Billion has now almost doubled in cost to RM55 Billion. Works minister Fadillah Yusof has as recent as 27 July 2016, denied a report by Sarawak Report that the ECRL cost will be doubled from RM30 Billion to RM60 Billion to pay off 1MDB debts. He also denied that the increment in cost was discussed in cabinet.

What has happened in the span of 3 months that the cost for ECRL almost doubled to RM55 Billion. Najib must explain on what basis that the cost of construction increase by RM25 Billion in 3 months. Was the RM25 Billion increment in cost discussed and sanctioned by the cabinet?

Secondly, the China Communiations Constuction Company(CCCC) which was awarded the ECRL construction contract was debarred by World Bank for fraudulent practices. Under the sanction, CCCC is ineligible to engage in any road and bridge projects financed by the World Bank Group until January 12, 2017.

Najib must explain why the ECRL contract was awarded to CCCC without open tender when it was debarred by World Bank for fraudulent practices.

Sarawak Report has in July published a report that the ECRL cost will be inflated and the additional cost siphoned off to pay 1MDB debts. This claim, if true will be the biggest daylight robbery of Malaysian Taxpayers. Future generations of Malaysians taxpayers will be squandered Billions of Ringgit to pay off the scandalous and mismanaged 1MDB debt.

I call on Najib to immediately give a proper and reasonable explanation on the haste in awarding the inflated ECRL contract to a Chinese company which is dubious, questionable and engaged in fraudulent practices.

Media Statement by Chong Zhemin, DAP Perak Economic Developement Bureau Chief and Political Secretary to Taiping MP on 3 Nov 2016

Najib new tiered corporate income tax rate announced in budget 2017 is not only cumbersome and complicated but also subject to tax manipulation.

Najib announced a new tiered corporate income tax rate in Budget 2017 based on the increment of chargeable income as below

Increment of chargeable income Reduction in tax rate Tax rate
5% or below None 24%
5% – 9.99% 1% 23%
10% – 14.99% 2% 22%
15% – 19.99% 3% 21%
20% and above 4% 20%

Firstly, this new tiered corporate income tax rate is subject to tax manipulation and will especially benefit multinational companies which have a group of companies. For example, a group of companies which comprise of company A, company B and company C may pool their revenue under company B and company C and park them under company A, thereby increasing its chargeable income to enjoy a lower tax rate (20%).

SME or smaller companies with only a single entity however could not benefit from this method except for expanding their business to increase their chargeable income up to 20% which seem unlikely in the current economic climate.

The IRB(Inland Revenue Board) will also incur extra administration cost to audit and administer this new tiered corporate tax rate based on increment of chargeable income.

Secondly, companies may be inclined to withhold investment in capital expenditure in the next two years in view of this new tiered tax rate. By not investing in new capital expenditure, thus claiming less Capital Allowances, the company’s chargeable income will be relatively higher to enjoy the new reduced tax rate.

Since the new tiered corporate tax rate is effective for 2017 and 2018, this will encourage companies to defer whatever investment(in capital expenditure) they can defer until 2019. This effect when aggregated will significantly hurt the country’s GDP, and negatively impact Malaysia economy in the coming two years.

It is clear that Najib administration is not sincere in reducing corporate tax rate. On one hand, Najib feared the loss in tax revenue, on the other hand Najib also feared public backlash if there is no corporate tax rate reduction announced, this give birth to the proposed monstrous tiered rate system based on the increment of chargeable income.

Najib should have announced a direct reduction of corporate tax rate instead of using the current proposed tiered rate which is cumbersome complicated and subject to tax manipulation.

Media Statement by DAP Perak Economic Development Bureau Chieft and Political Secretary to MP Taiping, Chong Zhemin on 22 Oct 2016

The UN Report that Malaysia’s poorest households are worst hit by GST is proof that Malaysia’s GST model is still regressive despite Malaysia having the longest list of zero rated goods in the world.

Malaysia’s Millennium Development Goals Report 2015 which was jointly released by the United Nation and Economic Planning Unit of the Prime Minister’s Department yesterday said that Malaysia’s household on the bottom 40 percent (B40) of the income spectrum are worst hit by the GST implementation. The B40 household income balance reduce from RM522 to RM400.
The Millenium Development Goals Report 2015 is proof that Malaysia’s GST model is still regressive despite Malaysia having the longest list of zero rated goods in the world making it the most complicated and cumbersome GST implementation.
Putrajaya has long argued that Malaysia’s GST model is not regressive due to the long list of zero rated goods. Despite the long list of zero rated goods, it is almost impossible for the B40 households to merely depend on zero rated list products and goods to survive.
For example, although bread is in the zero rated list, only white bread and whole meal bread are zero rated, bread with kaya filling, peanut filling and butter filling are tax at 6%. Although chicken is in the zero rated list, marinated chicken is taxed at 6%. Although cooking oil from oil palm, coconut and groundnuts are zero rated, cooking oil from sunflower, corn, safflower, soybean and olive are taxed at 6%.
Basic necessity food items such as milo, instant noodles, biscuits, canned food and bottled condiments are all taxed at 6%. How can the government expect Malaysia’s poorest household to solely feed on goods and products on the zero rated list?
Despite the government chest thumping and assurance, the fact remains that Malaysia’s poorest households are worst hit by GST and Malaysia’s GST model is still regressive.
Najib has revealed last month that the GST collection to date is RM51 Billion. The RM51 billion amounted to GST collected for 9 months since 1 April 2015. This figure if pro-rated will amount to an annual GST collection of RM68 Billion.
During the tabling of budget 2016 last year, the government expected to collect a RM39 Billion of GST revenue in 2016. The RM68 Billion of GST revenue is almost twice the amount Putrajaya expect to collect and almost 4 times of RM18 Billion of SST collected in 2014.
The GST revenue collection has exceeded the expected collection figure by twice the amount which means the 6% GST rate was set at an unreasonably high rate. It would only be fair to Malaysians that the government reduce the GST rate from 6% to 3%. This would also ease the B40 households from the GST burden.
Media Statement by Chong Zhemin, DAP Perak Economic Development Bureau Chief and Political Secretary to Taiping MP on 24 February 2016

Malaysia is again world number one illicit capital outflow per capita due to the refusal of Putrajaya to acknowledge and address the problem over the past few years.

  Malaysia has once again ranked fifth in the highest illicit outflow in an annual report of Global Financial Integrity behind China, Russia, Mexico and India. On a per capita basis, Malaysia is still ranked world number 1 of illicit capital outflow. This came as no surprise to Malaysians as Putrajaya has year after year came out with different and incredible excuses to play down the report and refuse to acknowledge, address and stop the bleed.

According to GFI report, Malaysia lost an accumulated amount of RM1.8 Trillion (USD 418.54 Billion) from 2004 – 2013. This astronomical amount dwarf the RM2.6 Billion “donation” received by Prime Minister Najib Razak.

The RM1.8 Trillion capital outflow is 692 times of “donation” received by Najib, 6.74 times of Malaysia total expenditure under budget 2016(RM267 Billion) and 2.43 times of Malayisa’s total National debt(RM740.7 Billion).

This astronomical amount lost over a decade is proof that corruption, abuse of power and crime is rampant in Malaysia.

There is an urgent need for Putrajaya to implement the recommendation by GFI to combat money laundering by enforcing strict anti money laundering laws. I call on Putrajaya to create a central public registry of corporate beneficial ownership information.

By creating a register of beneficial owner, the true owner of anonymous shell company will be made public and financial institutions will know the true beneficial owner of accounts making the tracking of funds and combatting money laundering easier.

The RM1.8 Trillion lost through illicit outflow from 2004-2013 is flabbergasted and mind-boggling. This is a “lost decade” for Malaysia. If BN again try to rubbish and ignore the GFI report, Malaysians will have no choice but to boot BN out of Putrajaya in the next election and look forward to a new government to stop the bleed.

Media Statement by Chong Zhemin, DAP Perak Economic Development Bureau Chief and Political Secretary to Taiping MP on 25 Dec 2015

Exempting Muslims from GST will make an unfair taxation policy even more unfair; instead Putrajaya should allow all religious donations as tax rebate to be fair to all Malaysians

Federal Territories mufti Zulkifli Mohammad Al Bakri’s proposal for Muslims to be exempted from paying the Goods and Services Tax (GST) will make an unfair taxation policy even more unfair. This is because Muslims have being granted a tax rebate under the Income tax act for paying Zakat whereas non-Muslims get only a tax relief when donating money to religious organisations.

A tax rebate will reduce the amount of tax payable while a tax relief will only reduce the chargeable income which will need to be multiplied with the prevailing tax rate to arrive at the tax payable.
For example, based on the Income Tax year of assessment 2014, a Muslim and Non-Muslim who both have a chargeable income of RM50,00 made a RM1,000 donation to religious organisation will have to pay for two significantly different amount of taxes.

Since Zakat is treated as a tax rebate, the Muslim who paid Zakat can directly reduce the amount of tax payable. At a chargeable income of RM50,00 and prevailing tax rate, the Muslim tax payable is RM2,850 and after the RM1,000 tax rebate; the net tax payable by the Muslim is RM1,850.
On the other hand, a non-Muslim who donated to religious organisation can only claim a tax relief that will reduce the chargeable income. At RM49,000 chargeable income, the non-Muslim have to pay a tax amounting to RM2,740.

Putrajaya must explain why two Malaysians who have the same income level and made the same amount of religious contribution are treated differently in their tax payable? Putrajaya should first look into this discrimatory tax policy before even discussing about exempting Muslims from GST which would make an unfair taxation policy even more unfair.

I call on Putrajaya to table a bill in the upcoming parliamentary sitting to amend the Income Tax Act 1967 to allow all kinds of religious donation to be granted a tax rebate. By granting a tax break to all religious donations, Malaysians will be more encouraged than ever to provide donation to religious organisations.
Federal Territories mufti Zulkifli Mohammad Al Bakri claimed that his proposal to exempt Muslims from GST has been discussed in cabinet. I call on MCA, MIC and Gerakan minister to declare their stand publicly on this issue whether they agree Malaysians to be given different tax treatment based on their religious belief.

Media Statement by Chong Zhemin, DAP Perak Economic Development Bureau Chief and Political Secretary to Taiping MP on 29 April 2015

GFI keep coming out with the “same thing” because Putrajaya has done absolutely nothing but looking for excuses in the past 6 years to curb the illicit capital outflow.

Minister in the Prime Minister’s Department Abdul Wahid Omar has dismissed the report by Global Financial Integrity (GFI) saying that he “absolutely disagrees” with the report and explained that Malaysia is a major trading nation which has a lot of multinationals.

Abdul Wahid Omar could not be more wrong; in fact he is the one who is churning out the “same excuses” to dismiss and rubbish the GFI report.

Among the list of world largest countries by exports in 2013, Malaysia is ranked at 21 behind countries like United States, Germany, Japan, France, South Korea and Netherlands. Abdul Wahid Omar must explain how is it possible that Malaysia which has a trade export 6.82 times smaller than the United States could record such an astronomical amount of RM1.38 trillion (USD 394.87 billion) of illicit capital outflow since 2003?

The only plausible and sensible explanation is that this amount is lost through crime and rampant corruption. The GFI report is also consistent with the annual auditor-General Report which has highlighted big incidences of corruption and the many mega scandals which has been exposed by Pakatan Rakyat leaders.

Abdul Wahid Omar also tried to downplay the GFI report by saying “We already explained last year, I think we don’t need to explain again. These people, they keep coming out with the same things again and again.”

The reason GFI keep coming out with the “same thing” because Putrajaya has done absolutely nothing but looking for excuses in the past 6 years to curb the illicit capital outflow since GFI published its first report in 2008.

There has been a total silence from Najib since the GFI report is made public two days ago. Is Najib taking his sweet time to come out with new “creative” excuses to dismiss and downplay the GFI report?

The GFI report proved that Najib has utterly failed in his fight against corruption. Huge amount of money continue to be siphoned out of the country under his administration.

This astronomical amount lost through illicit capital outflow is scandalous and shocking. With world crude oil prices tanking and the Malaysian Ringgit in a freefall, the continuous capital flight from Malaysia could only spell disaster for Malaysia economy.

Media Statement by Chong Zhemin, DAP Perak Economic Development Bureau Chief and Political Secretary to Taiping MP on 18 Dec 2014

Malaysia still world number one illegal capital outflow per capita, will Najib now agree to create a central public registry of corporate beneficial ownership information to curb illicit capital outflow?

According to the latest annual report by Washington-based Global Financial Integrity (GFI), Malaysia lost a total of RM171.11 billion (US$48.93 billion) in 2012 from illegal capital outflow. Malaysia ranks behind China, Russia, India and Mexico at 5th place. This astronomical amount lost is alarming and shocking but do not come to a surprise since Malaysia has been bleeding severely for the past few years and the government has no political will or whatsoever to put a stop to it.

If calculated on a per capita basis, Malaysia illicit capital outflow is still world number one in 2012 at USD1,646.36 (RM5,762.26) per capita, ahead of Russia USD 856.16 per capita, Mexico USD 774.81 per capita, China USD 183.91 per capita and India USD 47.65 per capita.

Putrajaya will again come out with the same old excuse that the illicit capital outflow is due to trade misinvoicing. However it is unthinkable that a country with a relatively small population at 29.72 Million is able to record such an astronomical amount of RM1.38 trillion (US$394.87 billion) from 2003 to 2012. It is clear that this astronomical amount is lost through crime and rampant corruption.

With world crude oil prices dropping, Malaysia’s economy outlook for 2015 is fragile and highly uncertain. Malaysia cannot afford to lose such an astronomical amount of money from illicit capital annually. Firm steps must be taken to stop the bleed.

If Najib is sincere in tackling the illicit capital outflow, he must heed the recommendation by GFI by creating a central public registry of corporate beneficial ownership information.

Under this move, all firms register in the country have a legal obligation to hold accurate and current information on the ultimate owner who benefits from the company which will be place on a central register maintained by the Companies House.

By creating a register of beneficial owner, the true owner of these anonymous shell companies will be make public. Financial institutions will know the true beneficial owner or owners of accounts opened with them hence making the cracking down of these ultimate beneficiary and tracking of funds transfer easier.

If Najib continues to ignore and rubbish the GFI report, Malaysian wealth will continue to be siphoned out at an alarming rate and it will be Malaysians who will ultimately pay the price for Najib incompetence.

Media Statement by Chong Zhemin, DAP Perak Economic Development Bureau Chief and Political Secretary to Taiping MP on 16 Dec 2014

How can Malaysians trust the KLIA2 independent audit committee to be independent when it is the MCA president who appoints the UTAR president to head the audit committee?

The KLIA2 independent audit committee announced by Liow Tiong Lai yesterday not only has a limited scope to probe the RM4 billion KLIA2 scandal but is also headed by a political puppet.

How can Malaysians trust the KLIA2 independent audit committee to get to the bottom of the RM4 billion KLIA2 scandal when it is headed by UTAR(Universiti Tunku Abdul Rahman) president Chuah Hean Teik which is owned by MCA.

By appointing a political puppet whose independence is questionable, is Liow Tiong Lai trying to whitewash and cover up the mismanagement and scandals in the construction of KLIA2 that has caused the cost of construction to balloon from RM1.7 billion to RM4 billion.

Liow will argue that he appointed Chuah Hean Teik on the merit that Chuah is the president of Federation of Engineering Institutions of Asia and Pacific (FEIAP). However the fact that Chuah also serves as the UTAR president has cast serious doubts whether he could carry out the audit on KLIA2 independently.

I urge Liow Tiong Lai to immediately widen the scope of the KLIA2 independent audit committee to include the probing of RM2.3 billion cost overrun and to reappoint an audit committee head who is truly independent.

Media Statement by Chong Zhemin, DAP Perak Economic Development Bureau Chief and Political Secretary to Taiping MP on 12 Dec 2014