Budget 2023: Shift From Grants To Tax Rebates
The Small and Medium Enterprises Association of Malaysia, or SAMENTA, hopes that the government will take steps to address urgent issues affecting SMEs in the upcoming Budget 2023.
SAMENTA has released its wish list for Budget 2023 to address both immediate and long-term challenges impacting the recovery and competitiveness of SMEs in Malaysia.
It has requested for governmental intervention to shift from grants to tax rebates to encourage better financial discipline among SMEs.
The wish list includes a double tax deduction for up to RM 1 million per company for capital expenditure to automate businesses, adopt digitalisation and IR4.0, and comply with ESG standards.
Lower Tax Bracket
Other proposals include a lower tax bracket, addressing the labour crunch, reducing cost pressures, and encouraging GLCs to support SMEs.
SAMENTA is committed to supporting over 1 million SMEs in Malaysia in partnership with various government Ministries and agencies.
Datuk William Ng, SAMENTA chairman, says that while cost pressures and labour shortage remain the most urgent issues impacting the recovery of SMEs, longer term challenges such as low productivity, digital displacement, regional competition and ESG compliance must be addressed soonest possible.
“In the longer term, we need to help our SMEs 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 SMEs, but there will also be increased competition. Hence, we need a focused push, not just ‘encouragement’ to get our SMEs to move up the value chain”, Ng said.
SAMENTA has also included in their wish list a lower tax bracket of 15% for the first RM 500,000 taxable income for SMEs, to encourage them to reinvest the savings into growing their businesses.