KUALA LUMPUR (April 25): Astro Malaysia Holdings Bhd (KL:ASTRO) said on Friday that its subsidiaries, Astro Shaw Sdn Bhd (ASSB) and Measat Broadcast Network Systems Sdn Bhd (MBNS), have reached a settlement agreement with the Inland Revenue Board (IRB) over additional tax assessments issued between 2019 and 2023.
Under the settlement agreement, Astro’s revised assessment amounted to RM114.95 million — RM4.04 million for ASSB and RM110.91 million for MBNS — with no penalties imposed.
This works out to be about 15.6% of the initial additional assessment that was raised by the IRB earlier.
The initial additional tax assessment raised by the IRB in July 2024 on the pay television company’s two subsidiaries amounted to RM734.88 million — RM22.01 million for ASSB and RM712.87 million for MBNS.
In a filing with Bursa Malaysia, Astro said the IRB has accepted additional justifications and documentation provided by ASSB and MBNS, resulting in the revised assessments.
Under the revised assessments, both subsidiaries are allowed to fully claim capital allowances on production costs, which results in unabsorbed capital allowances that will be carried forward for offset against future income.
Astro said the deferred tax assets arising from the unabsorbed capital allowances have been fully recognised. "There is however no profit and loss impact arising from this settlement expected for the financial year ended Jan 31, 2025 and thereafter," it added.
In July 2024, the IRB had issued the original notices after disallowing the subsidiaries’ production costs as deductible expenses, prompting Astro to file for judicial review to challenge the assessments.
Shares in Astro closed unchanged at 17 sen on Friday, for a market capitalisation of RM887.23 million.