Budget 2024 ‘will enhance the nation’s sustainability and resilience’

The Budget 2024’s focus on strengthening the economy, sustainability and ESG, upskilling, and strategic tax measures has been welcomed by the Malaysian Institute of Accountants (MIA).

‘’Accountancy talent is critical to the business and economy. We are pleased that certain measures support the development and on-going implementation of the MIA’s Competency Framework (CFM),” said Bazlan Osman, President of the MIA.

Osman cited as positive developments:

• the allocation of RM6.8 billion (£1.2bn) for Technical and Vocational Education and Training (TVET) education, which is essential to train and produce more young graduates.
• the extension of tax rebate up to RM2,000 (£345) for self-development and upskilling to 2026, which Osman described as “a good move in encouraging the young graduates and accountancy professionals to continue upskilling on specific courses as part of personal development”.
• the introduction of the Long-Term Social Visit pass for international students who have completed their education, which “bodes well for international accounting graduates to stay in the country to support the profession. This will contribute towards the net export for accounting services as well as promote the country as the accounting education and training hub,” he said.
• allocation of RM20 million to stimulate research, creativity and innovation in Islamic economics.

 

In a statement on its website, MIA said it “commended the Budget’s emphasis on strategic tax measures and efforts to diversify and strengthen collection to support development spending and fiscal health, which includes the increase in the SST rate to 8%, the introduction of new legislation that will subject the luxury goods to a tax rate of 5%–10% and the imposition of capital gains tax of 10% on shares of unlisted companies, subject to certain exemptions.

“In addition, MIA welcomes the retention of tax incentives to encourage women to re-enter the workforce which has been extended to 31 December 2027.”

 

Advocating for ESG

MIA said it “strongly advocates for sustainability and ESG for accountancy professionals to embrace the nation’s sustainability agenda”, which are in line with the following incentives:

• continuous support for sustainable and responsible investment (SRI), through the extension of tax exemptions to fund management companies that manage SRI funds.
• encouragement for more companies to participate in the voluntary carbon market, with an additional tax deduction up to RM300,000 for companies that spend on Measurement, Reporting and Verification (MRV) related to the development of carbon projects.

MIA’s Chief Executive Officer, Dr Wan Ahmad Rudirman Wan Razak, said he welcomed the Budget’s focus on digital transformation. He said: “Digital transformation can streamline financial processes, improve reporting accuracy, and enhance business efficiency, presenting opportunities for the accountancy profession in Malaysia.”

 

Help for small businesses

On its website the organisation said it “lauds the Government’s efforts to support the business continuity and resilience of micro, small, and medium enterprises (MSMEs) by providing financial assistance, digitalisation grants and loans. This aims to enhance competitiveness and encourage digitalisation among MSMEs to promote economic growth and inclusivity.
it said these include:

• RM100 million being allocated to provide digitalisation grants of up to RM5,000 for the benefit of over 20,000 MSMEs. These grants can be used to upgrade digital sales, inventory, and accounting systems.
• RM900 million loans under Bank Negara Malaysia to encourage SMEs to enhance business productivity through automation and digitalisation.

Dr Wan Ahmad Rudirman also hailed the Budget’s focus on strengthening Malaysia’s leadership in Islamic Finance. ‘’The measures will support MIA’s advocacy for Islamic Finance to facilitate the attainment of the UNSDGs and enhance shariah assurance.

“MIA is currently working on the Shariah Audit Best Practice Guide to promote consistency in industry practices for halal entities and aid members on providing assurance services’’, he added.

He said the institute is “strongly advocating for improving public financial management systems in support of good governance and sustainability”. To address the fiscal deficit, the Government has passed the Public Finance and Fiscal Responsibility Bill 2023 or the Fiscal Responsibility Act (FRA). “This reinforces the Government’s commitment to strengthening governance and ensuring transparency and accountability,” he said.