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Additional RM10 billion assistance targeted at SMEs, mixed reactions

FMM In The News: SME MAGAZINE, Monday, April 6, 2020 - 


The government today announced an additional RM10 billion assistance package targeted at helping small and medium enterprises (SMEs) which have been affected by the Movement Control Order (MCO) and the Covid-19 pandemic.

The package, announced by Prime Minister, Tan Sri Muhyiddin Yassin include:

  1. Expanded subsidies for SMEs with employees earning RM4,000 and below
    Companies that benefit from this subsidy will have to retain employees for six months — during the three-month period they receive the subsidy and three months after receiving the subsidy.
  • RM600 per employee for companies with more than 200 employees
  • RM800 per employee for companies with 76 to 200 employees
  • RM1,200 per employee for companies with up to 75 employees
  1. Special grant totalling RM2.1 billion for all eligible micro SMEs

All eligible micro SMEs are entitled to a special grant of RM3,000. These companies will need to register with the Inland Revenue Board (IRB) to enjoy this benefit.

  1. Abolishing of interest rates for the Micro Credit Scheme under Bank Simpanan Nasional (BSN). The scheme has also been extended to TEKUN Nasional with a maximum limit of RM10,000 for each company at an interest rate of 0%. RM200 million has been allocated for this purpose.
  1. Rent exemption or discounts for SMEs operating at premises owned by government-linked companies. MARA, Petronas, PNB, PLUS and UDA, along with several companies linked to the state governments, have agreed to give discounts or rent exemption for SMEs.
  1. Tax breaks for landlords that give rental discounts or exemptions to SMEs. These landlords will be given additional tax breaks equivalent to the amount of rent that has been reduced for the April to June 2020 period. However, the landlords will have to give at least a 30% rental discount in order to be eligible.
  2. Lowering of foreign worker levy by 25% for SMEs with employee permits expiring between April 1 and Dec 31, 2020. The levy is not applicable to housemaids.
  3. Moratorium of 30 days for submission of statutory documents by SMEs to Companies Commission of Malaysia (CCM)
  4. Extension of deadline for the submission of financial statements to three months after the end of the MCO. This only applies to companies with financial years ending 30 September to 31 December 2019. Companies will need to apply with CCM for the extension, with no late fees to be imposed.
  1. Application of loans via the IMSME.com.my portal. The portal, which is operated by Credit Guarantee Corporation (CGC) with the support of Bank Negara Malaysia, also offers the myKNP service, which provides SMEs funding advice.

In an immediate response to the SME stimulus package, the Federation of Malaysian Manufacturers (FMM) welcomed the additional allocation as timely. However, its president Tan Sri Soh Thian Lai said that as much as the government had responded to SME needs, some conditions for companies to qualify for the stimulus benefits may render it a bit difficult to claim the wage subsidies. “The increase of the RM7.9bil allocation towards the Wage Subsidy Programme to RM13.8bil exceeds the RM12bil that FMM had proposed in our appeal to the government following the announcement of the Prihatin Rakyat Economic Stimulus Package. “We also note that the limit on numbers eligible for the wage subsidy has been increased for the large companies from 100 previously to now 200 per company.

“However, we had hoped that the condition of a 50% reduction in revenue in order to qualify for the wage subsidy would have been removed as well as the ceiling of RM4,000. “We appeal to the government to remove this condition in view that many companies under the movement control order (MCO) have yet to finalise their financial accounts for March 2020,” Datuk Soh said in a statement after the announcement by the Prime Minister.

He also praised the stimulus package benefits for micro SMEs, such as the abolition of the 2% interest rate for the Micro Credit Scheme under Bank Simpanan Nasional. “FMM also recommends the moratorium extended to trade facilities, overdraft and leasing. “We also ask for a further reduction in interest rates for the RM5bil Special Relief Facility for SMEs from 3.5% to 2%, lessen lending conditions including collateral requirement as well as reduce the bureaucratic red tape involved in accessing the facility including the documents required and conditions attached, ” he said. He said FMM also hoped that this was not a one-off package for the business community and that it would be reviewed from time to time as this will assist large corporations that SMEs are dependent on as part of the business ecosystem.

Publisher of SME Magazine, Dato William Ng thanked the Prime Minister for the additional Economic Stimulus Package specifically with SMEs in mind. “As widely proposed by SME associations and SMEs in general, the wage subsidy has been increased by up to double the previously announced RM 600 per worker. This would translate into a 12 percent to 20 percent reduction in overall business expenses for most SMEs.” He added that the rental subsidy, via tax deduction for private landlords who offer rental reduction or waiver will also be helpful to SMEs in the retail and services sector, as rental is a significant portion of their expenses.

Dato Wiliam Ng, however said the government could have taken into consideration the plight of Malaysians operating in the gig economy. “Some of these would be registered businesses, and would fall under micro enterprises and therefore entitled to the RM 3000 subsidy announced. However, many have not done so – and therefore are once again left out by the updated stimulus pacakge.”

Dato Ng called on SMEs to take advantage of the stimulus and to keep as many jobs as possible, in anticipation of a mild rebound following the lifting of the Movement Control Order. He pointed out that SMEs in Malaysia have time and again, stepped out and saved the economy by keeping jobs and being in the front line to keep supply (and demand) robust. “This would be another testing time for our SMEs, and another opportunity for us to do our part.”

The Malaysian Trade Union Congress (MTUC) lauds the SME package but urged the government to let workers return to work. Its president Datuk Abdul Halim Mansor said the government’s move to increase the wage subsidy limit from 100 workers to 200 demonstrates that the government listens and is concerned about the needs of employers and SMEs. He added that the wage subsidy of RM600, RM800 and RM1,200 given to employers by the government was “unusual” and demonstrated that it was “serious”.

However, despite all these incentives, Datuk Halim urged the government to consider allowing workers to go back to work, albeit with terms and conditions that should be enforced for their safety and health. “MTUC sees that if this movement control order (MCO) is continued even longer, the country will face serious economic problems and the unemployment of too many people, ” he said in a statement. He called on employers and SMEs to come together to think of ways employers and employees can resume operations once again to restart the economy and to stand in solidarity in the fight against Covid-19.

The Malaysian Association of Tour and Travel Agents (MATTA) president Datuk Tan Kok Liang said the stimulus package has broadened the number of employers receiving government support. “The wage subsidy, which now has more categories, provides better relief for more SMEs and tourism enterprises, and gives them more breathing space. “However, we urge the government to reassess the situation in three months’ time and consider extending this (initiative), because it is virtually impossible for the hospitality and tourism industry to recover in three months, ” he said.

Malaysia Retail Chain Association (MRCA) president Datuk Seri Garry Chua said the latest stimulus package was a “big improvement” from the previous announcement. He said that many smaller SMEs would benefit from the wage subsidy, although bigger players with larger workforces may still struggle. “However, this aid must be disbursed immediately, it cannot wait any longer. Many companies already cannot pay salaries, ” he said. He said obtaining rental waivers from building owners in the private sector would remain difficult, even with the tax deductions the government is offering. “We are pleased that the package has taken care of the plight of micro-businesses through special grants and zero interest rate loans, ” he said.

He added that the revised categories for the wage subsidies is also “timely financial relief” to employers. He also lauded the fact that the government is encouraging mutual discussion between employers and employees concerning options such as pay cuts and unpaid leave during the movement control order (MCO) period.



The government today announced an additional RM10 billion assistance package targeted at helping small and medium enterprises (SMEs) which have been affected by the Movement Control Order (MCO) and the Covid-19 pandemic.

The package, announced by Prime Minister, Tan Sri Muhyiddin Yassin include:

  1. Expanded subsidies for SMEs with employees earning RM4,000 and below
    Companies that benefit from this subsidy will have to retain employees for six months — during the three-month period they receive the subsidy and three months after receiving the subsidy.
  • RM600 per employee for companies with more than 200 employees
  • RM800 per employee for companies with 76 to 200 employees
  • RM1,200 per employee for companies with up to 75 employees
  1. Special grant totalling RM2.1 billion for all eligible micro SMEs

All eligible micro SMEs are entitled to a special grant of RM3,000. These companies will need to register with the Inland Revenue Board (IRB) to enjoy this benefit.

  1. Abolishing of interest rates for the Micro Credit Scheme under Bank Simpanan Nasional (BSN). The scheme has also been extended to TEKUN Nasional with a maximum limit of RM10,000 for each company at an interest rate of 0%. RM200 million has been allocated for this purpose.
  1. Rent exemption or discounts for SMEs operating at premises owned by government-linked companies. MARA, Petronas, PNB, PLUS and UDA, along with several companies linked to the state governments, have agreed to give discounts or rent exemption for SMEs.
  1. Tax breaks for landlords that give rental discounts or exemptions to SMEs. These landlords will be given additional tax breaks equivalent to the amount of rent that has been reduced for the April to June 2020 period. However, the landlords will have to give at least a 30% rental discount in order to be eligible.
  2. Lowering of foreign worker levy by 25% for SMEs with employee permits expiring between April 1 and Dec 31, 2020. The levy is not applicable to housemaids.
  3. Moratorium of 30 days for submission of statutory documents by SMEs to Companies Commission of Malaysia (CCM)
  4. Extension of deadline for the submission of financial statements to three months after the end of the MCO. This only applies to companies with financial years ending 30 September to 31 December 2019. Companies will need to apply with CCM for the extension, with no late fees to be imposed.
  1. Application of loans via the IMSME.com.my portal. The portal, which is operated by Credit Guarantee Corporation (CGC) with the support of Bank Negara Malaysia, also offers the myKNP service, which provides SMEs funding advice.

 

In an immediate response to the SME stimulus package, the Federation of Malaysian Manufacturers (FMM) welcomed the additional allocation as timely. However, its president Tan Sri Soh Thian Lai said that as much as the government had responded to SME needs, some conditions for companies to qualify for the stimulus benefits may render it a bit difficult to claim the wage subsidies. “The increase of the RM7.9bil allocation towards the Wage Subsidy Programme to RM13.8bil exceeds the RM12bil that FMM had proposed in our appeal to the government following the announcement of the Prihatin Rakyat Economic Stimulus Package. “We also note that the limit on numbers eligible for the wage subsidy has been increased for the large companies from 100 previously to now 200 per company.

“However, we had hoped that the condition of a 50% reduction in revenue in order to qualify for the wage subsidy would have been removed as well as the ceiling of RM4,000. “We appeal to the government to remove this condition in view that many companies under the movement control order (MCO) have yet to finalise their financial accounts for March 2020,” Datuk Soh said in a statement after the announcement by the Prime Minister.

He also praised the stimulus package benefits for micro SMEs, such as the abolition of the 2% interest rate for the Micro Credit Scheme under Bank Simpanan Nasional. “FMM also recommends the moratorium extended to trade facilities, overdraft and leasing. “We also ask for a further reduction in interest rates for the RM5bil Special Relief Facility for SMEs from 3.5% to 2%, lessen lending conditions including collateral requirement as well as reduce the bureaucratic red tape involved in accessing the facility including the documents required and conditions attached, ” he said. He said FMM also hoped that this was not a one-off package for the business community and that it would be reviewed from time to time as this will assist large corporations that SMEs are dependent on as part of the business ecosystem.

Publisher of SME Magazine, Dato William Ng thanked the Prime Minister for the additional Economic Stimulus Package specifically with SMEs in mind. “As widely proposed by SME associations and SMEs in general, the wage subsidy has been increased by up to double the previously announced RM 600 per worker. This would translate into a 12 percent to 20 percent reduction in overall business expenses for most SMEs.” He added that the rental subsidy, via tax deduction for private landlords who offer rental reduction or waiver will also be helpful to SMEs in the retail and services sector, as rental is a significant portion of their expenses.

Dato Wiliam Ng, however said the government could have taken into consideration the plight of Malaysians operating in the gig economy. “Some of these would be registered businesses, and would fall under micro enterprises and therefore entitled to the RM 3000 subsidy announced. However, many have not done so – and therefore are once again left out by the updated stimulus pacakge.”

Dato Ng called on SMEs to take advantage of the stimulus and to keep as many jobs as possible, in anticipation of a mild rebound following the lifting of the Movement Control Order. He pointed out that SMEs in Malaysia have time and again, stepped out and saved the economy by keeping jobs and being in the front line to keep supply (and demand) robust. “This would be another testing time for our SMEs, and another opportunity for us to do our part.”

The Malaysian Trade Union Congress (MTUC) lauds the SME package but urged the government to let workers return to work. Its president Datuk Abdul Halim Mansor said the government’s move to increase the wage subsidy limit from 100 workers to 200 demonstrates that the government listens and is concerned about the needs of employers and SMEs. He added that the wage subsidy of RM600, RM800 and RM1,200 given to employers by the government was “unusual” and demonstrated that it was “serious”.

However, despite all these incentives, Datuk Halim urged the government to consider allowing workers to go back to work, albeit with terms and conditions that should be enforced for their safety and health. “MTUC sees that if this movement control order (MCO) is continued even longer, the country will face serious economic problems and the unemployment of too many people, ” he said in a statement. He called on employers and SMEs to come together to think of ways employers and employees can resume operations once again to restart the economy and to stand in solidarity in the fight against Covid-19.

The Malaysian Association of Tour and Travel Agents (MATTA) president Datuk Tan Kok Liang said the stimulus package has broadened the number of employers receiving government support. “The wage subsidy, which now has more categories, provides better relief for more SMEs and tourism enterprises, and gives them more breathing space. “However, we urge the government to reassess the situation in three months’ time and consider extending this (initiative), because it is virtually impossible for the hospitality and tourism industry to recover in three months, ” he said.

Malaysia Retail Chain Association (MRCA) president Datuk Seri Garry Chua said the latest stimulus package was a “big improvement” from the previous announcement. He said that many smaller SMEs would benefit from the wage subsidy, although bigger players with larger workforces may still struggle. “However, this aid must be disbursed immediately, it cannot wait any longer. Many companies already cannot pay salaries, ” he said. He said obtaining rental waivers from building owners in the private sector would remain difficult, even with the tax deductions the government is offering. “We are pleased that the package has taken care of the plight of micro-businesses through special grants and zero interest rate loans, ” he said.

He added that the revised categories for the wage subsidies is also “timely financial relief” to employers. He also lauded the fact that the government is encouraging mutual discussion between employers and employees concerning options such as pay cuts and unpaid leave during the movement control order (MCO) period.

The government today announced an additional RM10 billion assistance package targeted at helping small and medium enterprises (SMEs) which have been affected by the Movement Control Order (MCO) and the Covid-19 pandemic.

The package, announced by Prime Minister, Tan Sri Muhyiddin Yassin include:

  1. Expanded subsidies for SMEs with employees earning RM4,000 and below
    Companies that benefit from this subsidy will have to retain employees for six months — during the three-month period they receive the subsidy and three months after receiving the subsidy.
  • RM600 per employee for companies with more than 200 employees
  • RM800 per employee for companies with 76 to 200 employees
  • RM1,200 per employee for companies with up to 75 employees
  1. Special grant totalling RM2.1 billion for all eligible micro SMEs

All eligible micro SMEs are entitled to a special grant of RM3,000. These companies will need to register with the Inland Revenue Board (IRB) to enjoy this benefit.

  1. Abolishing of interest rates for the Micro Credit Scheme under Bank Simpanan Nasional (BSN). The scheme has also been extended to TEKUN Nasional with a maximum limit of RM10,000 for each company at an interest rate of 0%. RM200 million has been allocated for this purpose.
  1. Rent exemption or discounts for SMEs operating at premises owned by government-linked companies. MARA, Petronas, PNB, PLUS and UDA, along with several companies linked to the state governments, have agreed to give discounts or rent exemption for SMEs.
  1. Tax breaks for landlords that give rental discounts or exemptions to SMEs. These landlords will be given additional tax breaks equivalent to the amount of rent that has been reduced for the April to June 2020 period. However, the landlords will have to give at least a 30% rental discount in order to be eligible.
  2. Lowering of foreign worker levy by 25% for SMEs with employee permits expiring between April 1 and Dec 31, 2020. The levy is not applicable to housemaids.
  3. Moratorium of 30 days for submission of statutory documents by SMEs to Companies Commission of Malaysia (CCM)
  4. Extension of deadline for the submission of financial statements to three months after the end of the MCO. This only applies to companies with financial years ending 30 September to 31 December 2019. Companies will need to apply with CCM for the extension, with no late fees to be imposed.
  1. Application of loans via the IMSME.com.my portal. The portal, which is operated by Credit Guarantee Corporation (CGC) with the support of Bank Negara Malaysia, also offers the myKNP service, which provides SMEs funding advice.

 

In an immediate response to the SME stimulus package, the Federation of Malaysian Manufacturers (FMM) welcomed the additional allocation as timely. However, its president Tan Sri Soh Thian Lai said that as much as the government had responded to SME needs, some conditions for companies to qualify for the stimulus benefits may render it a bit difficult to claim the wage subsidies. “The increase of the RM7.9bil allocation towards the Wage Subsidy Programme to RM13.8bil exceeds the RM12bil that FMM had proposed in our appeal to the government following the announcement of the Prihatin Rakyat Economic Stimulus Package. “We also note that the limit on numbers eligible for the wage subsidy has been increased for the large companies from 100 previously to now 200 per company.

“However, we had hoped that the condition of a 50% reduction in revenue in order to qualify for the wage subsidy would have been removed as well as the ceiling of RM4,000. “We appeal to the government to remove this condition in view that many companies under the movement control order (MCO) have yet to finalise their financial accounts for March 2020,” Datuk Soh said in a statement after the announcement by the Prime Minister.

He also praised the stimulus package benefits for micro SMEs, such as the abolition of the 2% interest rate for the Micro Credit Scheme under Bank Simpanan Nasional. “FMM also recommends the moratorium extended to trade facilities, overdraft and leasing. “We also ask for a further reduction in interest rates for the RM5bil Special Relief Facility for SMEs from 3.5% to 2%, lessen lending conditions including collateral requirement as well as reduce the bureaucratic red tape involved in accessing the facility including the documents required and conditions attached, ” he said. He said FMM also hoped that this was not a one-off package for the business community and that it would be reviewed from time to time as this will assist large corporations that SMEs are dependent on as part of the business ecosystem.

Publisher of SME Magazine, Dato William Ng thanked the Prime Minister for the additional Economic Stimulus Package specifically with SMEs in mind. “As widely proposed by SME associations and SMEs in general, the wage subsidy has been increased by up to double the previously announced RM 600 per worker. This would translate into a 12 percent to 20 percent reduction in overall business expenses for most SMEs.” He added that the rental subsidy, via tax deduction for private landlords who offer rental reduction or waiver will also be helpful to SMEs in the retail and services sector, as rental is a significant portion of their expenses.

Dato Wiliam Ng, however said the government could have taken into consideration the plight of Malaysians operating in the gig economy. “Some of these would be registered businesses, and would fall under micro enterprises and therefore entitled to the RM 3000 subsidy announced. However, many have not done so – and therefore are once again left out by the updated stimulus pacakge.”

Dato Ng called on SMEs to take advantage of the stimulus and to keep as many jobs as possible, in anticipation of a mild rebound following the lifting of the Movement Control Order. He pointed out that SMEs in Malaysia have time and again, stepped out and saved the economy by keeping jobs and being in the front line to keep supply (and demand) robust. “This would be another testing time for our SMEs, and another opportunity for us to do our part.”

The Malaysian Trade Union Congress (MTUC) lauds the SME package but urged the government to let workers return to work. Its president Datuk Abdul Halim Mansor said the government’s move to increase the wage subsidy limit from 100 workers to 200 demonstrates that the government listens and is concerned about the needs of employers and SMEs. He added that the wage subsidy of RM600, RM800 and RM1,200 given to employers by the government was “unusual” and demonstrated that it was “serious”.

However, despite all these incentives, Datuk Halim urged the government to consider allowing workers to go back to work, albeit with terms and conditions that should be enforced for their safety and health. “MTUC sees that if this movement control order (MCO) is continued even longer, the country will face serious economic problems and the unemployment of too many people, ” he said in a statement. He called on employers and SMEs to come together to think of ways employers and employees can resume operations once again to restart the economy and to stand in solidarity in the fight against Covid-19.

The Malaysian Association of Tour and Travel Agents (MATTA) president Datuk Tan Kok Liang said the stimulus package has broadened the number of employers receiving government support. “The wage subsidy, which now has more categories, provides better relief for more SMEs and tourism enterprises, and gives them more breathing space. “However, we urge the government to reassess the situation in three months’ time and consider extending this (initiative), because it is virtually impossible for the hospitality and tourism industry to recover in three months, ” he said.

Malaysia Retail Chain Association (MRCA) president Datuk Seri Garry Chua said the latest stimulus package was a “big improvement” from the previous announcement. He said that many smaller SMEs would benefit from the wage subsidy, although bigger players with larger workforces may still struggle. “However, this aid must be disbursed immediately, it cannot wait any longer. Many companies already cannot pay salaries, ” he said. He said obtaining rental waivers from building owners in the private sector would remain difficult, even with the tax deductions the government is offering. “We are pleased that the package has taken care of the plight of micro-businesses through special grants and zero interest rate loans, ” he said.

He added that the revised categories for the wage subsidies is also “timely financial relief” to employers. He also lauded the fact that the government is encouraging mutual discussion between employers and employees concerning options such as pay cuts and unpaid leave during the movement control order (MCO) period.

The government today announced an additional RM10 billion assistance package targeted at helping small and medium enterprises (SMEs) which have been affected by the Movement Control Order (MCO) and the Covid-19 pandemic.

The package, announced by Prime Minister, Tan Sri Muhyiddin Yassin include:

  1. Expanded subsidies for SMEs with employees earning RM4,000 and below
    Companies that benefit from this subsidy will have to retain employees for six months — during the three-month period they receive the subsidy and three months after receiving the subsidy.
  • RM600 per employee for companies with more than 200 employees
  • RM800 per employee for companies with 76 to 200 employees
  • RM1,200 per employee for companies with up to 75 employees
  1. Special grant totalling RM2.1 billion for all eligible micro SMEs

All eligible micro SMEs are entitled to a special grant of RM3,000. These companies will need to register with the Inland Revenue Board (IRB) to enjoy this benefit.

  1. Abolishing of interest rates for the Micro Credit Scheme under Bank Simpanan Nasional (BSN). The scheme has also been extended to TEKUN Nasional with a maximum limit of RM10,000 for each company at an interest rate of 0%. RM200 million has been allocated for this purpose.
  1. Rent exemption or discounts for SMEs operating at premises owned by government-linked companies. MARA, Petronas, PNB, PLUS and UDA, along with several companies linked to the state governments, have agreed to give discounts or rent exemption for SMEs.
  1. Tax breaks for landlords that give rental discounts or exemptions to SMEs. These landlords will be given additional tax breaks equivalent to the amount of rent that has been reduced for the April to June 2020 period. However, the landlords will have to give at least a 30% rental discount in order to be eligible.
  2. Lowering of foreign worker levy by 25% for SMEs with employee permits expiring between April 1 and Dec 31, 2020. The levy is not applicable to housemaids.
  3. Moratorium of 30 days for submission of statutory documents by SMEs to Companies Commission of Malaysia (CCM)
  4. Extension of deadline for the submission of financial statements to three months after the end of the MCO. This only applies to companies with financial years ending 30 September to 31 December 2019. Companies will need to apply with CCM for the extension, with no late fees to be imposed.
  1. Application of loans via the IMSME.com.my portal. The portal, which is operated by Credit Guarantee Corporation (CGC) with the support of Bank Negara Malaysia, also offers the myKNP service, which provides SMEs funding advice.

 

In an immediate response to the SME stimulus package, the Federation of Malaysian Manufacturers (FMM) welcomed the additional allocation as timely. However, its president Tan Sri Soh Thian Lai said that as much as the government had responded to SME needs, some conditions for companies to qualify for the stimulus benefits may render it a bit difficult to claim the wage subsidies. “The increase of the RM7.9bil allocation towards the Wage Subsidy Programme to RM13.8bil exceeds the RM12bil that FMM had proposed in our appeal to the government following the announcement of the Prihatin Rakyat Economic Stimulus Package. “We also note that the limit on numbers eligible for the wage subsidy has been increased for the large companies from 100 previously to now 200 per company.

“However, we had hoped that the condition of a 50% reduction in revenue in order to qualify for the wage subsidy would have been removed as well as the ceiling of RM4,000. “We appeal to the government to remove this condition in view that many companies under the movement control order (MCO) have yet to finalise their financial accounts for March 2020,” Datuk Soh said in a statement after the announcement by the Prime Minister.

He also praised the stimulus package benefits for micro SMEs, such as the abolition of the 2% interest rate for the Micro Credit Scheme under Bank Simpanan Nasional. “FMM also recommends the moratorium extended to trade facilities, overdraft and leasing. “We also ask for a further reduction in interest rates for the RM5bil Special Relief Facility for SMEs from 3.5% to 2%, lessen lending conditions including collateral requirement as well as reduce the bureaucratic red tape involved in accessing the facility including the documents required and conditions attached, ” he said. He said FMM also hoped that this was not a one-off package for the business community and that it would be reviewed from time to time as this will assist large corporations that SMEs are dependent on as part of the business ecosystem.

Publisher of SME Magazine, Dato William Ng thanked the Prime Minister for the additional Economic Stimulus Package specifically with SMEs in mind. “As widely proposed by SME associations and SMEs in general, the wage subsidy has been increased by up to double the previously announced RM 600 per worker. This would translate into a 12 percent to 20 percent reduction in overall business expenses for most SMEs.” He added that the rental subsidy, via tax deduction for private landlords who offer rental reduction or waiver will also be helpful to SMEs in the retail and services sector, as rental is a significant portion of their expenses.

Dato Wiliam Ng, however said the government could have taken into consideration the plight of Malaysians operating in the gig economy. “Some of these would be registered businesses, and would fall under micro enterprises and therefore entitled to the RM 3000 subsidy announced. However, many have not done so – and therefore are once again left out by the updated stimulus pacakge.”

Dato Ng called on SMEs to take advantage of the stimulus and to keep as many jobs as possible, in anticipation of a mild rebound following the lifting of the Movement Control Order. He pointed out that SMEs in Malaysia have time and again, stepped out and saved the economy by keeping jobs and being in the front line to keep supply (and demand) robust. “This would be another testing time for our SMEs, and another opportunity for us to do our part.”

The Malaysian Trade Union Congress (MTUC) lauds the SME package but urged the government to let workers return to work. Its president Datuk Abdul Halim Mansor said the government’s move to increase the wage subsidy limit from 100 workers to 200 demonstrates that the government listens and is concerned about the needs of employers and SMEs. He added that the wage subsidy of RM600, RM800 and RM1,200 given to employers by the government was “unusual” and demonstrated that it was “serious”.

However, despite all these incentives, Datuk Halim urged the government to consider allowing workers to go back to work, albeit with terms and conditions that should be enforced for their safety and health. “MTUC sees that if this movement control order (MCO) is continued even longer, the country will face serious economic problems and the unemployment of too many people, ” he said in a statement. He called on employers and SMEs to come together to think of ways employers and employees can resume operations once again to restart the economy and to stand in solidarity in the fight against Covid-19.

The Malaysian Association of Tour and Travel Agents (MATTA) president Datuk Tan Kok Liang said the stimulus package has broadened the number of employers receiving government support. “The wage subsidy, which now has more categories, provides better relief for more SMEs and tourism enterprises, and gives them more breathing space. “However, we urge the government to reassess the situation in three months’ time and consider extending this (initiative), because it is virtually impossible for the hospitality and tourism industry to recover in three months, ” he said.

Malaysia Retail Chain Association (MRCA) president Datuk Seri Garry Chua said the latest stimulus package was a “big improvement” from the previous announcement. He said that many smaller SMEs would benefit from the wage subsidy, although bigger players with larger workforces may still struggle. “However, this aid must be disbursed immediately, it cannot wait any longer. Many companies already cannot pay salaries, ” he said. He said obtaining rental waivers from building owners in the private sector would remain difficult, even with the tax deductions the government is offering. “We are pleased that the package has taken care of the plight of micro-businesses through special grants and zero interest rate loans, ” he said.

He added that the revised categories for the wage subsidies is also “timely financial relief” to employers. He also lauded the fact that the government is encouraging mutual discussion between employers and employees concerning options such as pay cuts and unpaid leave during the movement control order (MCO) period.

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