Sport industry players hopeful of more tax deductions ahead of Budget 2024

A recent meeting between representatives from the Youth and Sports Ministry and the Inland Revenue Board (IRB) has excited sport industry players in Malaysia.

The meeting, attended by Youth and Sports Minister Hannah Yeoh, and IRB chief executive officer, Datuk Seri Mohd Nizom Sairi, was to discuss possible tax deductions for those involved in sports.

Currently, only the purchase of sports equipment is tax deductible in Malaysia.

“Personal trainers and coaches have to upskill themselves via CPE (continuing professional education) seminars. That can be expensive,” said Playground Fitness owner, Toh Yen Kee.

“If they can claim tax deductions for these training programmes, it may encourage more to sign up for these sessions.

“It will benefit them and their clients.”

Toh said not everyone would understand the tax impact as they would not see cash in their pockets.

“However, they will notice it when they prepare their yearly income tax returns. Then, they can deduct the training expenditure,” said Toh, who added the move would help businesses.

“It is great that the minister has different ideas to help the industry. We had submitted some proposals to her predecessors, but nothing came of them.”

Among the proposals, under the banner of ‘Promoting business and industry sustainability’ that were submitted to the ministry, were:

  • Personal income tax deductions of up to RM6,000 for expenses relating to gym subscriptions/tech wearable/ apparel/equipment.
  • Tax deductions for research and development costs on programming that can be licenced regionally or globally by the Investment, Trade and Industry Ministry.
  • Policies to promote the active lifestyle, fitness, and sports activities, led by the Youth and Sports Ministry, together with the Health and Education ministries.
  • Sales and Service Tax (SST) waiver for lifestyle expenses, including gym memberships.

“Besides the tax breaks in the proposals, we also suggested a national policy with three ministries working in concert to make Malaysia a healthy and active nation,” said Toh.

“We can start with healthy eating in schools. It is a long-term plan. We will only see the results three years down the road.

“But we need to have a habit of culture and lifestyle sustainably. We had other campaigns, but none made a lasting impression.”

Earlier this year, Yeoh had urged the Finance Ministry to consider giving tax exemptions to companies that invest in sports.

Sports consultant Nur Jasni Mohamed commended Yeoh for taking the initiative, but said more could be done to help the industry.

He said in Europe, volunteers with sports associations could claim some tax breaks.

“For instance, accountants or lawyers who offered their services pro bono to the associations could claim for tax deductions,” said Nur Jasni.

“Although they do not charge the associations a fee, their time is valuable. Being allowed to claim deductions may encourage even more professionals to get involved.

“Perhaps the minister can discuss this with the IRB.”

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