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2% cut in tax rate will help micro SMEs, says business chamber

FMM In The News: FREE MALAYSIA TODAY, KUALA LUMPUR, Friday, October 7, 2022 - Tax cuts for micro small and medium enterprises (MSMEs) next year will help ease their cost of doing business, says Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) president Low Kian Chuan.

He said the lower tax rate on taxable income for the first RM100,000 has met the association’s recommendation to aid MSMEs in reviving their businesses.

“The MSMEs have already been burdened with substantial increases in business and operating costs and a 2% cut — from 17% to 15% — will result in RM2,000 savings for 150,000 taxpayers,” he said in a statement yesterday.

In a separate statement, Dagang NeXchange Bhd group managing director Syed Zainal Abidin Syed Mohamed Tahir said SME’s funds for digitalisation and automation, as well as relevant grants and tax incentives, could help generate their growth and expansion.

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“Incentives to push for overall digitalisation can promote the adoption of digital technology among SMEs and lead to a rise in innovation, enhanced productivity and improvement in services,” he said.

In the 2023 budget, RM10 billion in loan funds will be made available through Bank Negara to encourage the automation and digitisation of SMEs as well as support the food security agenda and the recovery of the tourism sector.

Federation of Malaysian Manufacturers (FMM) president Soh Thian Lai said the RM1 billion allocation for the Low Carbon Transition Facility to assist SMEs adopting low carbon practices as well as RM10 million matching grant to assist SMEs conducting carbon assessment was a good start for them to kick-start their environment, social and governance (ESG) journey.

“Moving forward, more funding would be required in the ensuing years to help SMEs sustain and continue with their ESG journey,” he said.

Meanwhile, Tune Protect Group Bhd CEO Rohit Nambiar said the RM305 million allocation through the Penjaja Muda scheme for youth entrepreneurs would encourage young entrepreneurs and help address unemployment, while nurturing young talent.

“One of Tune Protect’s business pillars targets SMEs to help mitigate against risk factors that come with owning a business.

“We will be rolling out a new product targeted at SMEs, particularly for their employees, within the next couple of months,” he said.

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