12 Market Info
BUDGET
What’s In It For You & I? udget 2022 was tabled in Parliament on 29 of October 2021 with the theme “Keluarga Malaysia, Makmur Sejahtera” and the focus was on 3 key objectives, namely: 1. Rakyat’s wellbeing; 2. Building business resilience; and 3. Creating a prosperous and sustainable economy The Malaysian economy is forecasted to continue its recovery with GDP expected to grow at a slightly faster pace of 5.5% to 6% for 2022 compared to 3% to 4% projected in 2021. Budget 2022 is the largest ever Malaysian Budget, with a record spending of RM332.1 billion – an increase of 3% compared to the allocated budget in 2021. Of this, RM233.5 billion was set aside for operational expenses, RM75.6 billion for development expenses, RM23 billion for the Covid-19 fund, and the balance of RM2 billion for contingencies. Government revenue is predicted to rise 5.9% to RM234 billion in 2022, up from RM221 billion in 2021, with the budget deficit falling to 6% of GDP in 2022, down from 6.5 percent in 2021. Overall, the budget is comprehensive and inclusive in line with the “Keluarga Malaysia” spirit in ensuring that no one is left behind in Malaysia’s development.
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Malaysia Retailer Vol 9 No 3
WHAT’S FOR INDIVIDUALS?
SPECIAL TAX EXEMPTION FOR DOMESTIC TOURISM
The following are key tax changes affecting individuals in Malaysia arising from Budget 2022:
To further encourage domestic tourism, it is proposed that the special tax exemption up to RM1,000 be extended for domestic tourism expenses incurred from 1 January 2022 to 31 December 2022.
TAX RELIEFS It is proposed that the scope of tax relief of RM4,000 for voluntary contributions to EPF is to include individuals who are self-employed and employed in the gig sector. In addition, there is an extension of the minimum contribution rate for employees of 9% to EPF until June 2022. For lifestyle relief, the special tax relief of RM2,500 for the purchase of mobile phones, computers and tablets will be extended for one year to 31st of December 2022. This will enhance the scope of income tax relief for lifestyle. It is proposed that the tax relief from the total education fees relief of RM7,000 be increased from RM1,000 to RM2,000 for Year of Assessment 2022 and Year of Assessment 2023 for fees paid for upskilling or selfenhancement courses recognised by the Department of Skills Development, Ministry of Human Resources. This is to encourage individuals who are affected by the pandemic to enrol for upskilling, re-skilling and to build up new skills.
CHILDCARE CENTRE A ND KINDERGARTENS There will be an extension of tax exemption up to RM3,000 for 2 years for Year of Assessment 2022 and Year of Assessment 2023 for fees paid to childcare centres and kindergartens. This will alleviate the childcare centre and kindergarten expenses incurred by taxpayers.
TAX RELIEF FOR MEDICAL CHECK-UP EXPENSES The existing tax relief of RM1,000 for full medical check-up expenses for self / spouse / child have been expanded to include medical expenses involving registered psychiatrists, clinical psychologists, counsellors, etc. This will reduce the medical expenses burden for the taxpayer, their spouses and children.
PERSONAL TAX RELIEF FOR SOCSO It is proposed that the personal tax relief for SOCSO be increased
