Expansion of Cultural Expense Income Tax Deduction for Sports Facilities Broadens Everyday Sports Participation

Income Tax Deduction Expansion for Cultural Expenses Began Last July
Gym Revenues Up 4.5 Times, Swimming Pools Up 3.5 Times

Following the expansion of the cultural expense income tax deduction to include sports facilities, the base of everyday sports activities has greatly expanded, as evidenced by a sharp increase in revenues at gyms and swimming pools.

The Ministry of Culture, Sports and Tourism announced on July 8 that, since the implementation of the “Expansion of Cultural Expense Income Tax Deduction to Sports Facilities” policy, participation in everyday sports activities has increased, with the revenue of gyms and fitness centers rising by approximately 4.5 times and swimming pool revenues by 3.5 times.

The policy allows employees with a total annual salary of 70 million won or less to deduct 100% of the usage fees and 50% of the lesson fees spent at registered sports facilities from their taxable income. The policy, which took effect on July 1 last year, covers fitness centers, swimming pools, comprehensive sports facilities, and public sports facilities.

In order to assess the impact of this policy, the ministry compared card payment sales and usage patterns before and after implementation, using card transaction data from four major credit card companies and pseudonymized combined data from a credit rating agency for registered cultural expense income deduction businesses. The analysis found that, after the policy was introduced, the card payment revenue, number of users, and per capita card spending at sports facility operators all increased significantly.

Card payment revenue for fitness centers and gyms rose from 18.19 billion won in the first half of last year to 82.73 billion won in the second half, representing an approximately 4.5-fold (354.7%) increase. During the same period, card payment revenue for swimming pools surged from 5.11 billion won to 17.92 billion won, a 3.5-fold (250.6%) increase.

The number of gym and fitness center users increased by 85%, from 357,000 in the first half of last year to 661,000 in the second half. The number of swimming pool users also rose by 58.7%, from 311,000 to 493,000. The average card spending per user during this period increased by 144.5% at fitness centers and by 120.8% at swimming pools.

The ministry explained that both card payment revenue and the number of users began to increase from July last year, when the policy was implemented, and remained high through the end of the year, indicating that spending on sports facilities has continued to expand since the introduction of the policy.

Kim Daehyun, Second Vice Minister of the Ministry of Culture, Sports and Tourism, stated, “Expanding the income tax deduction for sports facility usage fees has gained broad public support, as it revitalizes the sports industry and encourages participation in leisure activities. The ministry will continue to operate the system more proactively and effectively so that people can experience tangible benefits in their daily lives.”

This content was produced with the assistance of AI translation services.