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Friday, 01 August 2008 08:20am |
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 ©The
Star (Used by permission)
by Elan Perumal, Stuart Michael, Lim Chia Ying
LOCAL governments in Selangor will continue to impose penalty
charges for late or unpaid assessment charges until they get a directive from
the state government ordering them to do otherwise.
Selayang Municipal Council (MPS) president Zainal Abidin Azim said the council
would continue with the penalty charges for those who failed to pay their
assessment rates on time.
He said this when asked to comment on the ruling by the Federal Court
recently that local authorities did not have the legal right to impose penalty
charges on assessment tax defaulters who pay late or failed to pay their
assessment rates.
The court was reported to have made the landmark decision on July 18 in favour
of Generation Products Sdn Bhd against the Klang Municipal Council (MPK) for
continuous imposition of penalty for late settlement of assessment rates since
1985.
Zainal said this was news to his council and that he was unaware of the
announcement.
“I’ll have to check and discuss matters concerning assessment with our legal
department,” he said.
“Over the next few days, we have to discuss and maybe amend our bylaws or Act.
We are waiting for the state government to give us directives.
“As far as we know, imposing the penalty charges has always been a norm for us.”
Meanwhile, a check with the Petaling Jaya City Council (MBPJ) revealed that the
council does not charge interest on late payment of assessment fees.
PJ mayor Datuk Mohamad Roslan Sakiman said MBPJ only charged a fee for issuing a
late notice for unpaid arrears.
According to the website of the Subang Jaya Municipal Council (MPSJ), it stated
that if the owner fails to pay assessment rates within a given deadline, then a
penalty of 5% will be imposed on the total arrears.
It stated that a Form E notice will be issued and payment has to be made within
15 days from the date of issuance of notice.
After that, a warrant of arrest will be enforced and a 10% interest rate will be
imposed on the entire arrears.
This is followed by an action of sealing and auctioning of the property and
later court action.
While it was difficult to reach some MPSJ officers yesterday, its public
relations officer Azfarizal Abdul Rashid claimed that the council had always
done things according to by-laws and does not carry out unlawful action.
Shah Alam City Council mayor Mazalan Mohd Noor said the judgment did not affect
the council’s method of collecting assessment.
He said this was because the council only penalised the errant ratepayers once.
“The errant ratepayers will not be repeatedly penalised for late payment as the
council does not practice compounding ‘interest’ while collecting the arrears.”
Mazalan also said the council had not received any directive on whether there
was a need to revise its system from the Selangor government.
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Circular No 304/2008
There should not be any misunderstanding at all.
It is not that penalty charges cannot be imposed BUT that the amount of penalty charges imposed should be reasonable and covers only administrative charges, and certainly cannot and should not be so high as a penalty of 10% of the unpaid assessment over-due and unpaid.
It is only right and proper for all Local Governments to abide by the ruling/decision.
MBPJ now tries to divert the issue and say that it does not charge interest. While the MBPJ does not charge interest, it does charge 10%penalty on late and over-due payments as well. This it should stop doing if it wants to be right, proper and righteous.
What right has MBPJ to charge interest when it is not a financial institution?
Tan Peek Guat