The Budget 2024 announcement is expected to provide further updates on the implementation of the global minimum tax (GMT) in Malaysia, said Ernst and Young Tax Consultants Sdn Bhd.
The firm’s Malaysia tax leader, Farah Rosley said the GMT is in line with Pillar Two of the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting (BEPS) 2.0 project, as well as the previously announced capital gains tax on the sale of unlisted shares by companies.
She said the proposals in Budget 2024 will be important in progressing Malaysia’s aspiration of transforming into a high-income nation, having a highly skilled workforce, continuing to attract foreign direct investments (FDI) and spurring domestic investments, achieving sustainability agenda and addressing the cost-of-living concerns of the people.
“In addition to reducing costs, a higher tax deduction for healthcare and education costs can be provided to allow for more disposable income to cover the higher spending on this necessary expenditure.
“It is also hoped that renewable energy and green initiatives will continue to be a focus. Providing special deductions, allowances or tax incentives would encourage more businesses to invest in ‘green’ assets or be involved in sustainability activities,” she said in a statement today.
Farah is hoping that targeted tax incentives will continue to feature in the Malaysian tax system, in order to attract both FDIs and domestic direct investments.
More importantly, she said the requirements and conditions of the tax incentives should be transparent and reasonable, whilst also providing the desired benefits to the country.
“With FDIs, the country will benefit from the flow of funds into the country, transfer of knowledge and technology as well as more training and upskilling of workers, which contributes to the development of human capital.
“This would provide more socio-economic stability for the people through the increased job creation which in turn, would spur domestic activities and promote healthy competition in the local economy,” she added.
Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim will table Budget 2024 on Oct 13.
Source: BERNAMA News Agency
