KUALA LUMPUR (Jan 12): After securing court permission to challenge the Inland Revenue Board's (IRB) additional RM78.49 million tax assessment, Southern Power Generation Sdn Bhd — a 70%-owned unit of Tenaga Nasional Bhd (TNB) — is now in talks with the tax agency for a potential out-of-court settlement.
TNB disclosed this in a bourse filing on Friday, after the hearing of the case scheduled a day earlier was vacated due to the settlement talks, with March 28 being fixed as the next hearing date.
The additional taxes slapped on Southern Power — in which the remaining 30% equity stake is held by SIPP Energy Sdn Bhd, a company linked with the Johor royalty — were for the years of assessment of 2017 to 2021.
Southern Power operates two 720MW combined cycle gas turbine power plants in Pasir Gudang, Johor. Notices of the additional tax assessments were issued to Southern Power in May last year, after which it sought the court's permission to challenge the IRB's decision by way of a judicial review. The court granted its permission in September last year for it to proceed with its challenge.
“If the parties manage to reach a settlement before March 28, 2024, the hearing will be vacated,” said TNB.
Separately, the court also granted an extension of the interim stay of the enforcement of the notices until March 28, said TNB.
TNB shares fell 10 sen or 0.96% to close at RM10.34 on Friday, giving the group a market capitalisation of RM59.84 billion.