Latest news with #SAPA
Borneo Post
4 days ago
- Business
- Borneo Post
Govt urged to reconsider mandatory stamp duty on employment contracts
Tan KOTA KINABALU (June 3): The Sabah Association of Professional Accountants (SAPA) expresses concern over the recent directive by the Inland Revenue Board (LHDN Malaysia) requiring all employment contracts to be stamped in accordance with the Stamp Act 1949. 'While we recognise the importance of legal compliance and revenue collection, SAPA calls on the government to urgently consider exemptions or threshold limits, especially for small and medium enterprises (SMEs),' said its president, Datuk Tan Kok Liang. He said this policy places additional administrative and financial burdens on businesses — particularly in Sabah, where operating costs are already higher due to logistics, geographic challenges, and a more constrained labour market. 'The move to enforce stamp duty on all employment contracts, regardless of salary level or business size, risks creating unintended pressure on SMEs,' he said in a statement on Tuesday. The key concerns are as follows: Disproportionate impact on SMEs: Unlike large corporations, small businesses operate on tight margins. A blanket enforcement adds to compliance costs without proportional benefit. Administrative Burden: The need to process, submit and pay for stamp duty on every employment contract creates extra red tape, especially for businesses with high staff turnover or seasonal employment. Impact on formalised contracts: Over-regulation in the hiring process may discourage small businesses from formalising contracts thus placing employees in rural and semi-urban Sabah into vulnerable position. SAPA's recommendations: Introduce a Threshold Limit: Exempt employment contracts for positions with monthly salaries below a reasonable threshold (e.g. RM4,000), in line with many other tax relief measures. Provide Full or Partial Exemption for Micro and Small Enterprises: Particularly those with annual revenue below RM500,000 or fewer than 10 employees. Phase Implementation with Outreach: This includes sufficient time to meet up with the new requirements and a new implementation date of 1 January 2026 and approach with education and support will ease compliance. SAPA strongly urges the Ministry of Finance and the Inland Revenue Board to engage with industry stakeholders in Sabah and other less-developed states before blanket implementation. Public policy must consider regional disparities, business realities, and the broader objective of stimulating employment and economic growth. 'We are confident that with constructive dialogue, a balanced policy solution can be achieved that protects both the interests of the government and the resilience of our local business community,' said Tan. He added the Stamp Act must be modernised to reflect current practical realities rather than remaining rooted in outdated and regressive approaches. While its original intent and purpose — to provide legal certainty and protect the interests of contracting parties — remain important, these objectives must be interpreted in the proper context. The Act should not be used in a manner that causes undue inconvenience or serves merely as a revenue-generating tool. In the case of employment contracts, for instance, such agreements have long been executed and honored by both employers and employees without issue. This consistent practice demonstrates mutual respect and understanding of contractual obligations, regardless of whether the documents were stamped. Insisting on strict adherence to outdated requirements, especially where there is no dispute between parties, undermines the spirit of the law and creates unnecessary administrative burdens, he pointed out. 'It is time for a balanced approach — one that preserves the protective function of the Stamp Act but updates its application to align with modern business practices and realities' he said. Previous Article UMS water supply sufficient, says Shahelmey
The Star
4 days ago
- Business
- The Star
Sabah accountants urge rethink on stamp duty for employment contracts
KOTA KINABALU: The Sabah Association of Professional Accountants (SAPA) is urging the federal government to reconsider the blanket enforcement of stamp duty on all employment contracts. The group warns that the policy could burden small and medium-sized enterprises (SMEs), particularly in Sabah. While acknowledging the legal and fiscal rationale behind the Inland Revenue Board's directive, SAPA president Datuk Tan Kok Liang stated that the policy must consider the realities of doing business in less-developed regions like Sabah. "This requirement places additional administrative and financial burdens on employers, especially SMEs operating under constrained resources and geographical challenges," he said on Tuesday (June 3). He added that SAPA calls for a more balanced approach by exempting contracts with monthly salaries below RM4,000, offering exemptions to micro and small enterprises, and phasing in the policy with an implementation date no earlier than January 1 next year, alongside stakeholder engagement and educational outreach. Tan noted that the directive risks discouraging small businesses from formalising employment contracts due to overregulation and red tape. "This could inadvertently leave workers in rural or semi-urban Sabah vulnerable and without formal employment protection," he said. He added that while the Stamp Act 1949 was enacted for legal clarity and contractual certainty, its enforcement must evolve. "In practice, employment contracts have been respected by both employers and employees, with or without a stamp. Strict enforcement based on outdated provisions is counterproductive," he said. Tan then said that SAPA believes reforming the Stamp Act to reflect modern business practices is essential to prevent it from becoming solely a revenue collection tool. "We remain confident that through constructive dialogue, a balanced policy solution can be achieved, one that upholds the law while safeguarding local businesses and promoting employment," said Tan.
The Star
27-05-2025
- Business
- The Star
Sabah implementing policy to boost local accounting sector
KOTA KINABALU: The Sabah government has introduced a new policy to boost local economic participation in the procurement of audit and financial services by State Statutory Bodies and government-linked companies. Under the new guidelines, contracts for audit and financial services valued below RM50,000 must be awarded exclusively to Sabah-based firms registered with the Sabah Association of Professional Accountants (SAPA). For contracts exceeding RM50,000, priority must still be given to local firms, with exceptions allowed only upon written justification to the Ministry. On the guidelines, state Finance Minister Datuk Seri Masidi Manjun said that the policy prioritises appointing accounting firms domiciled in Sabah. He added that this marks a significant step in empowering local professionals and enhancing the state's accounting sector competitiveness. "This policy is not just about procurement; it is about creating real opportunities for Sabahans,' said Masidi. "We want our young accounting graduates to thrive in their home state, with economic growth driven by local expertise," he added. Masidi said that Sabah is ready to nurture and grow its professional class, especially in accounting and finance, which are vital to good governance and economic development. Meanwhile, SAPA president Datuk Tan Kok Liang expressed appreciation to the State Government, describing the policy as visionary. "We thank the Minister and the Sabah Government for this significant initiative. It represents a pivotal shift towards inclusive development and reflects a genuine commitment to strengthening Sabah's professional ecosystem," said Tan. During the meeting, Masidi presented certificates of membership to SAPA's first batch of 15 new members, symbolising the government's support for a strong and vibrant accounting community in the state.
New Straits Times
27-05-2025
- Business
- New Straits Times
Sabah prioritises local firms in new audit and financial services policy
KOTA KINABALU: The Sabah government has introduced a new policy to support local participation in the auditing and financial services sector. Sabah Finance Minister Datuk Seri Masidi Manjun said it would apply to state statutory bodies and government-linked companies (GLCs). He said the policy gives priority to accounting firms based in Sabah, helping to keep more business within the state. It also aims to strengthen the local accounting industry and support homegrown talent, he said. "This policy is not just about procurement, it's about securing opportunities for Sabahans. "We want our young accounting graduates to thrive in their home state, and for our economic growth to be driven by local expertise. "We are sending a clear message, Sabah is ready to nurture and grow its professional class, especially in fields like accounting and finance, which are vital to good governance and economic development," he said in a statement. Under the new rules, all audit and financial contracts worth less than RM50,000 must be awarded to firms based in Sabah and registered with the Sabah Association of Professional Accountants (SAPA). For contracts above RM50,000, local firms must still be prioritised, with exceptions allowed with written approval from the ministry. Meanwhile, SAPA thanked the state government for launching the initiative, which would boost job and training opportunities for local professionals. "It represents a pivotal shift towards inclusive development and shows genuine commitment to the future of Sabah's professional ecosystem," said SAPA president Datuk Tan Kok Liang, who was quoted in the same statement following a courtesy visit to Masidi's office here. Tags: Sabah, audit, local talent, Masidi Manjun, NST
Borneo Post
27-05-2025
- Business
- Borneo Post
New Sabah policy mandates local accounting firms for govt contracts under RM50,000
Masidi (ninth from right) receiving a memento from Tan after presenting the first batch of SAPA members with their certificates of membership. KOTA KINABALU (May 27): The Sabah Government has introduced a new policy to strengthen local economic participation in the procurement of audit and financial services by state statutory bodies (BBN) and government-linked companies (GLCs). The move prioritises the engagement of accounting firms domiciled in Sabah, thereby keeping economic value within the state and is a significant step forward in the state's commitment to empower homegrown professionals and enhance the competitiveness of Sabah's accounting sector. 'This policy is not just about procurement – it is about securing opportunities for Sabahans. 'We want our young accounting graduates to thrive in their home state, and for our economic growth to be driven by local expertise. 'We are sending a clear message: Sabah is ready to nurture and grow its professional class, especially in fields like accounting and finance, which are vital to good governance and economic development,' said Datuk Seri Masidi Manjun, the Minister of Finance Sabah. Under the new guidelines, all audit and financial services contracts below RM50,000 are to be awarded exclusively to Sabah-based firms registered with the Sabah Association of Professional Accountants (SAPA). Priority must still be given to local firms for contracts exceeding RM50,000, with limited exceptions allowed upon written justification to the Ministry. In a courtesy call to the Minister of Finance on Tuesday, SAPA expressed its appreciation to the State Government for introducing this initiative. The association believes this will significantly improve employment and training opportunities for local professionals. 'We thank the honourable minister and the Sabah Government for this visionary policy. 'It represents a pivotal shift towards inclusive development and shows a genuine commitment to the future of Sabah's professional ecosystem,' said SAPA president Datuk Tan Kok Liang. During the meeting, Masidi also presented membership certificates to SAPA's first batch of 15 new members, symbolising the government's support for the growth of a strong and professional accounting community in Sabah.
