THE Federation of Malaysian Manufacturers (FMM) said the wide range of measures under the economic package would have extensive impact on all economic sectors, directly and indirectly.
The package is focused on galvanising consumption in the domestic market particularly in the services and retail sectors, by increasing disposal income for employees and providing bonuses to civil servants, it said in a statement.
The manufacturing sector will directly benefit from the assurance of improvements in the delivery of funds to businesses, especially SMEs, which can also expect more funds through the topping up of the SME Fund and the New Entrepreneurs Fund.
Investors would benefit from more relaxed FIC guidelines, the extension of the pioneer status period and the tax allowances for those under the special packages scheme.
The assurance of speedier processing of Certificates of Fitness for occupation (CF) and land conversion would also bring in revenue to the government at a faster pace and expedite economic and land development.
The package will indirectly benefit the manufacturing sector with the increase in housing construction and infrastructure projects that would in turn benefit the building material industry.
Industries supplying agricultural-related products and services will also benefit from the government emphasis on greater food production, as will industries supplying products and services to hotels and tourism sector with the incentives given to the hospitality industry.
FMM hopes that Budget 2004 would continue to reflect the same approach to introduce further measures to improve the economy. Towards this end, FMM proposed that the government remove the 15%-30% import duty for audio-visual, video conferencing equipment and TV monitors.
It also called for the reduction of telecommunications tariff especially on ISDN and video conferencing facilities by at least 50% along the same policy of providing a discount of 50% in the electricity bill for hotels under the economic package.
“In line with the Human Resource Development Fund exemption given to the hospitality industry, the government should also reduce the contribution from 1% to 0.5% for all other sectors.”
FMM also hoped the government would reduce employers' contribution to the EPF.
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