THE IMPACT OF TAX PLANNING ON THE SDGS OF MALAYSIAN LISTED COMPANIES: A LITERATURE REVIEW

Abstract

Responsible and transparent tax planning is essential for ensuring sufficient government revenue to support the achievement of the Sustainable Development Goals (SDGs). Aggressive tax practices, on the other hand, weaken fiscal capacity and slow national progress in key areas of development. Malaysia’s tax framework, including the Income Tax Act 1967 and the Promotion of Investments Act 1986, provides various incentives and allowances that enable companies to plan their taxes responsibly while contributing to sustainable initiatives. Provisions such as approved donations, pioneer status, and investment tax allowances allow corporations to strengthen their financial strategies and align with national sustainability targets without facing unnecessary tax burdens. Guided by Corporate Culture Theory, responsible tax planning reflects ethical decision-making where companies avoid harmful practices like profit shifting and instead utilise tax incentives to advance environmental, social, and economic objectives. Properly managed tax policies transform tax planning from a mere financial exercise into a strategic mechanism that balances corporate interests with societal needs. By embedding social responsibility into their fiscal strategies, Malaysian corporations can play a crucial role in driving sustainable growth and supporting the broader SDGs, ensuring long-term benefits for both business and society.