ALOR STAR: Businesses in Kedah hope the 2023 Budget will include assistance for them to get back on their feet following the economic slump brought about by Covid-19.
They said the budget should have a strategy to help them weather tougher economic outlook next year.
“Next year is expected to be challenging due to unforeseen risks, in particular fear of a global economic slowdown and inflation rate spike,” Malaysian Malay Chamber of Commerce (DPMM) Kedah chapter president Datuk Mohd Zayad Md Ismail told the New Straits Times.
He said it was imperative for the government improve the public delivery system.
He said Kedah DPMM hoped the Finance Ministry would come up with a formula to boost domestic production, especially food.
Zayad added that it was crucial to ensure food security so that prices stabilised and inflation could be brought down.
“The pandemic and lockdowns in the past two years had brought devastating impacts. Many businesses, including food producers had winded down, pushing the price of food up.
“The government will have to focus on helping food producers boost production,” he said.
Zayad said the government and financial institutions could provide micro credit and financing schemes to food producers, particularly those in rural areas.
He said the financing should be accessible, including doing away with requirements for a guarantor or collateral.
“The loan interest rate should be low so that producers can invest in modern equipment to rebuild business and boost productivity,” he said.
The state DPMM also wished for the government to enhance the Digitalisation Grant Initiative for small and medium enterprises (SMEs).
“We hope the allocation will be raised from the previous RM200 million as the amount was insufficient for education, training and equipment to improve businesses.
“Based on data, most of the RM14.2 billion allocated for SMEs under the 2022 Budget was not accessible to small players, as the bulk of the funds went to big players.
“We also hopef the government will increase the allocation for automation and digitalisation to help businesses shift to Industrial Revolution 4.0 with clear and structured approaches,” he said.
Kedah DPMM also urged the government to address the labour shortage which had reached a critical level in key sectors, including manufacturing, construction, agriculture, services, mining and quarry.
“We need a clear solution and direction as quickly as possible to support domestic economy recovery.
“The government may want to consider reducing levies to facilitate employers to recruit the foreign workers without further delay,” he said.
The Kedah Chinese Chamber of Commerce and Industry (CCCI) urged the government to consider relaxing taxes for business and individuals.
Its president, Ang Saik Chong, said the move was necessary as many businesses were struggling to recover from the pandemic.
“For SMEs, we hope the Federal Government will consider reducing the 17 per cent tax on the first RM600,000 in revenue, to 14 per cent, while the tax on revenue above RM600,000 be lowered from 24 per cent to 21 per cent.
“We also hope the government will lower the income tax on individuals and businesses of 28 per cent to 25 per cent.
“Lower taxes will ease the pressure on companies’ cash flow, while helping them to sustain business amid the fear of a global economic slowdown next year,” he said.
Ang added that the chamber also wished that the government consider tax relief for individual income earners.
“We hope the government will consider raising taxable income from RM9,000 to RM12,000.
Azman Ghani (OC), [9/27/2022 2:32 PM]
“We also wish for the government to consider raising the RM2,000 tax relief for a child aged 18 and below and the RM8,000 tax relief for children studying at higher learning institutions,” he said.
Ang said the move would help families mitigate higher cost of living and at the same time enabling parents to invest more on their children.
“We urge the government to review the current RM3,000 tax relief for medical insurance policies,” he said.
Ang said the chamber felt that the maximum annual medical coverage amount was too small for bigger families.
“By doing so, those who can afford medical insurance will seek treatment at private facilities.
“This will ease congestion at public hospitals and help the government save operation cost for public hospitals,” he said.
Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz is scheduled to table the 2023 Budget in the Dewan Rakyat on Oct 7.