PETALING JAYA: The Malaysian International Chamber of Commerce and Industry (MICCI) has called for greater clarity on tax measures and effective implementation of initiatives announced under Budget 2027.
Its president Christina Tee said the budget balanced fiscal consolidation with measures to sustain economic growth and address cost-of-living pressures.
"For businesses, the Budget presents opportunities to ease selected operating costs, although the impact will depend on the measures’ scope and implementation," she said.
On taxation, Tee noted the proposed facility for manufacturers to reclaim sales tax on eligible machinery, spare parts and equipment purchased from local traders or distributors, as well as specified raw materials used to produce pharmaceutical products, animal feed, fertilisers and pesticides.
"While this could ease costs for eligible manufacturers, MICCI encourages the Government to clarify the facility’s scope and eligibility criteria, and consider extending it to a broader range of manufacturing inputs," she said.
On efforts to reduce red tape and improve public service delivery through the STAR team and Government Service Efficiency Commitment Programme, Tee said these initiatives must deliver tangible improvements.
"Clear service-level agreements (SLAs), processing timelines and accountability would help reduce uncertainty when dealing with government agencies," she said.
She also noted that the reintroduction of the Variation of Price (VOP) clause would help construction contractors manage increases in diesel and bitumen prices, although its effectiveness would depend on implementation.
On the minimum wage increase to RM2,000 from June 2027, alongside an exemption for businesses with annual sales below RM50mil, Tee cautioned that higher payroll costs could further squeeze margins in labour-intensive industries already grappling with elevated operating expenses.
She urged the government to consider these cumulative cost pressures and provide sufficient lead time for employers to prepare.
Meanwhile, Tee said the continued development of the Johor-Singapore Special Economic Zone (JS-SEZ) and enhanced tax incentives for Global Services Hub activities from January 2027 could attract further investment.
However, she said longer-term benefits would depend on their ability to generate sustained economic activity and quality employment.
On the proposed E-Commerce Bill, Tee urged the government to engage MICCI's E-Commerce Chapter, which brings together five of Malaysia's leading e-commerce players, as the Bill's provisions are developed.
"Industry consultation will help ensure the framework is practical, proportionate and effective in supporting fair competition while protecting sellers and consumers," she said.
Tee added that Budget 2027's impact would ultimately depend on effective implementation, with clear policies, predictable processes and manageable operating costs remaining important to business confidence and investment.
