(1) Except for sections 4 (a), 4 (b), 4 (d), 6 (a), 6 (b), mentoenco- 7(b), 7 (c), 8, 17, 18, 19, 22, 23 and 24 (b) the provisions amendof this Chapter shall have effect for the year of assess- ments to ment 1986 and subsequent years of assessment.
[Cap. II, S. 3-4]
(2) Section 4 (d) shall have effect for the year of assessment 1984 and subsequent years of assessment. asesmenit 1985 and au bsequent years of assesemen of
(4) Sections 6 (a), 6 (b), 7 (b), 7 (c) and 22 shall hav eiect for the year of assessment 1987 and subsequen years of assessment.
(5) Sections 4 (a), 4 (b), 8, 17 and 19 shall be deemed to have come into force on the 25th October 1985.
(6) Section 24 (b) shall be deemed to have come into force on the 25th October 1985: Provided that in the case where a long-term loan agreement-
(i) was entered into and the money lent or deposited in Malaysia was remitted to Malaysia before the 25th October 1985 or was entered into and for which permission was given by the Controller of Foreign Exchange under the Exchange Control Act 1953 on or before the 25th October 1985; and
(ii) the terms, conditions or duration of that longterm loan have not been altered in any manner on or after the 25th October 1985, the interest paid or credited on such loan shall continue to be exempt for the duration of the loan notwithstanding the withdrawal of the exemption provided for in paragraph 31 of Schedule 6 to the Income Tax Aot 1967.
(7) Section 18 shall come into force on the 1st January 1986.
Section 2 of the Income Tax Act 1967, which in this Chapter is referred to as "the principal Act", is amended-
(a) by substituting for the interpretation of "approved loan" in subsection (1), the «"approved loan" means any loan or credit made to the Government, State Government (including any loan or credit made to a person other than the Government or State
FINANCE (No.2) [Cap. II, S. 4-6
(b) by deleting the interpretation of "long-term loan" in subsection (1);
(c) by deleting the interpretation of "shareholders' funds" in subseotion (1); and
(d) by inserting immediately after subsection (6), the followingnew subsection (7): "(7) Any reference in this Act to interest shall apply, mutatis mutandis, to gains or profits received and expenses incurred, in lieu of interest, in transactions conducted in accordance with the Syariah.". stituting for paragraph (a), the following:
Section 3A of the principal Act is amendedby sub-peton3e "(a) a company, two million ringgit;".
Section 5 of the principal Act is amended—
(a) by subsituting for the fuill stop at the end of ecitonds. subsection (1), a colon;
(b) bytion (ing the following new proviso to subn respect of interest paid or credited to thal ndividual.", and "(3) In ascertaining the chargeable ion secion 3a there shall noe be taposn
[Cap. II, S. 6-9] into account any statutory income o1 adjusted loss in respect of petroleun operations by a petroleum company and dividends paid by a petroleum company out of its income derived from its petroleum operations within section 6. 15/67.
Subsection (1) of section 6 of the principal Act is amended—
(a) by deleting the words "or long-term loan" in subparagraph (i) of paragraph (b);
(b) by substituting for the full stop at the end of paragraph (e), a semi-colon; and
(c) by inserting immediately after paragraph (e), the following new paragraph (f): "(f) subject to the provisions of section 109c but notwithstanding any other provisions of this Act, income tax shall be charged ror each year of assessment upon th‹ income of an individual resident il which consists of interest (other than interest exempt from tax under this Act or any order made thereto) Amend nent of section 13. Soctonte. appropriate rate as specified under Part
Subsection (1) of section 13 of the principal Act is amended by substituting for the proviso to subparagraph(ii) of paragraph (b), the following: "Provided that the benefit or amenity enjoyed under this subparagraph is confined only to the employee and members of his immediate family.".
Section 18 of the principal Act is amended-
(a) by inserting immediately after the interpretapreati "of vensurancee following new inter- •"insurance" includes a takaful Act 312. scheme pursuant to the Takaful Act 1984., and
[Cap. II, S. 9-11)
(b) by inserting immediately after the interpretation of "plantation", the following new interpretation of "premiums": '"premiums", in relation to insurance, includes contributions or instalments payable under a takaful Act 312. 1984ge pursuant to the Takaful Act
Section 44 of the principal Act is amended-
(a) by substituting for the full stop at the end of tectien 4t. subsection (6), a colon; and
(b) by inserting immediately after subsection (6), the following new proviso: "Provided that where the statutory income from an employment, pension or profession falls to be assessed in the name of an individual's wife for the relevant year pursuant to section 45 (4), there shall be deducted from such statutory income or the aggregate of such statutory income, as the case may be, an bct ia tre bas year lor thac yeuan,mad by
Section 45 of the principal Act is amended-
(a) by inserting immediately after the words section 45 income from employment" in subsection (4). , from pension granted on optional retirement from employment under any writter
(b) by substituting for subsection (5), the follow- "(5) Notwithstanding any other provisions of assessment in her name
(a) her total income falling to be aggregated with that of her husband under subsection (2) for that year of assess-
[Cap. II, S. 11-17] section 47, section 48. section 49. section 50. shall be treated as having no chargeabl income for that year of assessment in regard to that part of her total income which is aggregated with that of her husband; and
(b) the income assessed in her name shall Rrotesaten orte agtuae o oach statutory income, as the case may be, made pursuany to seution aling to bo
(c) by inserting immediately after the words income from employment" in subsection (6), a comina and the word "pension".
Section 47 of the principal Act is amended by inserting immediately after the words "income from her employment" in subsection (4), a comma and the word "pénsion".
Subsection (1) of section 48 of the principal Act is amended by inserting immediately after the words "income from her employment" in the proviso, a comma and the word "pension".
Subseotion (1) of section 49 of the principal Act is amended by inserting immediately after the words "income from her employment" in the proviso, a comma and the word "pension".
Section 50 of the principal Act is amended by inserting immediately after the words "from her employsubsection (4), a comma and the word New section 60AA
The principal Aat is amended by inserting immediately after section 60A, , the following new section 60AA: Applicaion of 60AA. The provisions of sections 60 and 60A sections shall apply, mutatis mutandis, to a takafu 0 arakadul , business carried on pursuant to the Takaful business. Act 1984.". Act 312. men ent
Section 109 of the principal Act is amended by section 109. deleting the words "or long-term loan" in subsection (1).
[Cap. II, S. 18]
The principal Act is amended by inserting imme- Ner liately after section 109B, the following new section sectio 109c: under this Act or any order made thereto accruing in or derived from Malaysia to a1 individual resident in Malaysia, he shall upor paying or crediting such interest deduct there. shall within one month after paying or crediting the interest render an account and pay the amount of that tax to the Director General: Provided that the Director General may under special circumstances, allow extension of time for tax deducted to be paid over. Act 102. Ac1 276. him to the Government and shall be payable forthwith to the Director General. SENE payer.
(4) In this section "person" refers to a bank licensed under the Finance Companies Act 1969, a registered co-operative society, Bank Barbad, Or any Mer viscituion that may ty
[Cap. II, S. 19-22] SeGion® Senedule 1.
Section 136 of the principal Act is amended—
(a) by substituting for the full stop at the end of subsection (4), a colon; and
(b) by inserting immediately after subsection (4), the following new proviso: "Provided that the Director General may by writing under his hand authorize any Senior Assistant or Assistant Directors of Inland Revenue (subject to any exceptions o1 limitations contained in the authorization) to exercise his function under section 123.".
Item 1 of Part II of Schedule 1 to the principal Act is amended-
(a) by deleting the words "or long-term loan"; and
(b) by substituting for the words "15%" under the column "Rate of income tax", the words Part III of Schedule 1. New Part Schedule 1.
Source: Laws of Malaysia, Attorney General's Chambers of Malaysia (lom.agc.gov.my). Not a copy of the Gazette printed by the Government Printer (Interpretation Acts 1948 and 1967, s 61).
