Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin

The introduction of single-tier tax system into Malaysian taxation system has caused the elimination of tax credit available to shareholders offered by the imputation tax system. Single-tier tax system was effectly implemented in January 1, 2008 that treats dividend income as exempted in the hands o...

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Main Author:	Hussin, Nur Syafiqah
Format:	Thesis
Language:	English
Published:	2015
Online Access:	http://ir.uitm.edu.my/id/eprint/17710/ http://ir.uitm.edu.my/id/eprint/17710/2/TM_NUR%20SYAFIQAH%20HUSSIN%20AC%2015_5.pdf

id	uitm-17710
recordtype	eprints
spelling	uitm-177102018-10-18T02:43:33Z http://ir.uitm.edu.my/id/eprint/17710/ Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin Hussin, Nur Syafiqah The introduction of single-tier tax system into Malaysian taxation system has caused the elimination of tax credit available to shareholders offered by the imputation tax system. Single-tier tax system was effectly implemented in January 1, 2008 that treats dividend income as exempted in the hands of the shareholders. However, the profound point under single tier tax system rest on the taxability of dividend income based on the company tax rate. Retirees, tax-exempt bodies and non-profit organisations that generally fall under lower tax bracket would feel the burden. This study, using 248 listed companies in Bursa Malaysia, specifically company with dividend paying status between year of 2002 to 2014, provides evidence on the effect of tax change on dividend payout to public listed companies in Malaysia. The study found no statistically difference in the mean score of dividend payout before and after the implementation of single-tier tax system in Malaysia. From the perspective of dividend paying companies in Malaysia, the study also found a significant positive relationship between profitability and dividend payout, which means that companies in Malaysia distribute higher dividend payout when they record higher profitability. Lagged dividend also shows a significant positive relationship with dividend payout, which implies that companies in Malaysia are reluctant to cut their dividend payment to shareholders. In contrast, a significant negative relationship was found between growth opportunity and dividend payout, which indicates that companies in Malaysia tend to internally finance their expected investments faced by the company. As such, the theories supported for this study are information content/signalling theory, life cycle theory and agency theory. Nevertheless, liquidity and leverage were found not to have a significant relationship with dividend payout for companies in Malaysia. 2015 Thesis NonPeerReviewed text en http://ir.uitm.edu.my/id/eprint/17710/2/TM_NUR%20SYAFIQAH%20HUSSIN%20AC%2015_5.pdf Hussin, Nur Syafiqah (2015) Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin. Masters thesis, Universiti Teknologi MARA.
repository_type	Digital Repository
institution_category	Local University
institution	Universiti Teknologi MARA
building	UiTM Institutional Repository
collection	Online Access
language	English
description	The introduction of single-tier tax system into Malaysian taxation system has caused the elimination of tax credit available to shareholders offered by the imputation tax system. Single-tier tax system was effectly implemented in January 1, 2008 that treats dividend income as exempted in the hands of the shareholders. However, the profound point under single tier tax system rest on the taxability of dividend income based on the company tax rate. Retirees, tax-exempt bodies and non-profit organisations that generally fall under lower tax bracket would feel the burden. This study, using 248 listed companies in Bursa Malaysia, specifically company with dividend paying status between year of 2002 to 2014, provides evidence on the effect of tax change on dividend payout to public listed companies in Malaysia. The study found no statistically difference in the mean score of dividend payout before and after the implementation of single-tier tax system in Malaysia. From the perspective of dividend paying companies in Malaysia, the study also found a significant positive relationship between profitability and dividend payout, which means that companies in Malaysia distribute higher dividend payout when they record higher profitability. Lagged dividend also shows a significant positive relationship with dividend payout, which implies that companies in Malaysia are reluctant to cut their dividend payment to shareholders. In contrast, a significant negative relationship was found between growth opportunity and dividend payout, which indicates that companies in Malaysia tend to internally finance their expected investments faced by the company. As such, the theories supported for this study are information content/signalling theory, life cycle theory and agency theory. Nevertheless, liquidity and leverage were found not to have a significant relationship with dividend payout for companies in Malaysia.
format	Thesis
author	Hussin, Nur Syafiqah
spellingShingle	Hussin, Nur Syafiqah Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin
author_facet	Hussin, Nur Syafiqah
author_sort	Hussin, Nur Syafiqah
title	Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin
title_short	Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin
title_full	Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin
title_fullStr	Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin
title_full_unstemmed	Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin
title_sort	reaction towards change of tax policy: single-tier tax system in malaysia / nur syafiqah hussin
publishDate	2015
url	http://ir.uitm.edu.my/id/eprint/17710/ http://ir.uitm.edu.my/id/eprint/17710/2/TM_NUR%20SYAFIQAH%20HUSSIN%20AC%2015_5.pdf
first_indexed	2023-09-18T22:58:54Z
last_indexed	2023-09-18T22:58:54Z
_version_	1777418039945330688

Reaction towards change of tax policy: single-tier tax system in Malaysia / Nur Syafiqah Hussin

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