More steps needed to address SME issues

PETALING JAYA: The Small and Medium Enterprises Association of Malaysia (Samenta) has requested the government to take more steps to address urgent issues affecting the small and medium enterprises (SMEs) in the revised Budget 2023.

Samenta chairman Datuk William Ng said that while cost pressures and labour shortage remained the most urgent issues impacting the recovery of SMEs, longer-term challenges such as low productivity, digital displacement, regional competition, and environmental, social and governance (ESG) compliance should also be addressed the soonest possible.

“We are hopeful that the government will take both immediate and long-term views at ensuring the SMEs remain competitive, which in turn will support the national aspiration to regain its status as an Asian Tiger.

“This requires more than fiscal intervention and would need major reforms of our economy, but let us start with Budget 2023,” he said in a statement yesterday.

In the immediate term, he said the country needed to shift governmental intervention from outright grants to tax rebates to encourage better financial discipline among SMEs.

For a start, Ng said Samenta would recommend a double tax deduction of up to RM1mil per company for the 2023 assessment year for capital expenditure to automate businesses, adopt digitalisation and the Fourth Industrial Revolution (IR4.0), as well as comply with the ESG standards.

“This will be on top of expanding the scope of low carbon transition facilities to include consulting and training as well as any upgrading of facilities and processes that could lead to higher productivity,” he said. — Bernama