Former MP calls for tax reform to narrow rich-poor divide
He said Malaysia must adopt new tax mechanisms, including a wealth tax, inheritance tax and unexplained wealth order, to combat corruption, curb illicit financial flows and create a more equitable system.
"These reforms are necessary to rebalance the current inequality," Santiago told the New Straits Times.
"It's time to stop 'pampering' corporations and the wealthy with generous incentives in the name of attracting foreign investment."
He criticised the government's continued provision of corporate tax breaks and its failure to address issues such as transfer pricing abuse, illicit financial outflows, and leakages in public spending.
"Malaysia continues to borrow to fill a hole that the ultra-rich and corporations refuse to plug," he said.
"The current tax system is regressive. Indirect taxes like the Sales and Services Tax (SST) and high excise duties hit low- and middle-income earners hardest, while direct taxes on the wealthy remain low."
Last week, Treasury secretary-general Datuk Johan Mahmood Merican defended Malaysia's low-tax regime, saying it was essential to remain competitive and attract investment.
However, Santiago said that competitiveness should not come at the expense of fairness.
"Taxation must be progressive, not punitive to the poor. The rich and corporations benefit from public infrastructure, education and subsidies. Yet, they avoid taxes and demand more incentives. It's time they paid their fair share."
He also urged the government to be bolder in addressing inequality and introducing meaningful tax reforms.
"We cannot keep turning a blind eye to the billions lost through loopholes, mismanagement and tax avoidance. Progressive taxation isn't a burden, it's a tool for justice," he said.
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