KUALA LUMPUR: The Small and Medium Enterprises Association of Malaysia (Samenta) hopes that the government will take steps to address urgent issues affecting SME in the upcoming Budget 2023.
Samenta chairman Datuk William Ng said that while cost pressures and labour shortage remain the most urgent issues impacting the recovery of SME, longer term challenges such as low productivity, digital displacement, regional competition and ESG compliance must be addressed soonest possible.
“We are hopeful that the government will take both an immediate and long-term view at ensuring our SME remain competitive, which in turn will support our national aspiration to regain our status as an “Asian Tiger”. This requires more than fiscal intervention, and would need major reform of our economy. But let’s start with Budget 2023”, Ng said.
“In the immediate term, we need to shift governmental intervention from outright grants to tax rebate to encourage better financial discipline among SME. The wisdom of teaching our SME to fish rather than giving them fishes hold true here. For a start, we are asking for a double tax deduction for up to RM1 million per company for YA2023 for capital expenditure to automate businesses, adopt digitalisation and IR4.0 and to comply with ESG standards. This will be on top of expanding the scope of low carbon transition facility to include consulting and training as well as any upgrading of facilities and processes that could lead to higher productivity,” he added.
“In the longer term, we need to help our SME raise their productivity rapidly to remain competitive in the face of digital displacement and regional competition. With the signing of CPTPP and RCEP, there will be more opportunities for our SME, but there will also be increased competition. Hence, we need a focused push, not just ‘encouragement’ to get our SME to move up the value chain,” said Ng.
