PETALING JAYA: Federation of Malaysian Manufacturers (FMM) said that investment in research and development (R&D) is important in moving towards a higher value-added and knowledge based economy.
Under Budget 2015, a RM1.3bil allocation was given to the Science, Technology and Innovation Ministry to implement innovation and commercialisation programmes.
Prime Minister Datuk Seri Najib Tun Razak in his budget speech on Friday said Malaysia’s R&D expenditure as a share of gross domestic product was low, compared with advanced economies such as Japan and South Korea.
“Public R&D funds should benefit as many stakeholders as possible in the respective target sectors,” FMM said in a statement. It said the double deduction in tax incentive for structured internship diploma and vocational students was a step in the right direction.
FMM said while it recognised the Government efforts to encourage the private sector to be involved in the management, maintenance and upgrading of industrial estates through the provision of income tax exemption incentives, it viewed that the primary responsibility should still lie with the local authorities.
“The capital outlay and operating expenditure for maintaining infrastructure is high and should be borne by local authorities that collect local taxes including assessments from industry,” it said.
FMM, however, is not supportive of the proposed introduction of Employment Insurance Scheme.
It said the Government should first amend the Companies Act to give priority to payments to workers over all other creditors, including taxes.
“Based on initial consultations, there is no quid pro quo from unions on retrenchment benefits as a trade-off for employers to consider the scheme,” it said.