KUCHING, Feb 25: Small and Medium Enterprise (SME) Association of Sarawak president Jordan CS Ong hopes that loan agencies could simplify their loan application process.
In a statement, he lamented that, from experience, the application process is lengthy and complex.
“SMEs can benefit from the government if the application process for grants, loans, and incentives is smooth and transparent,” he said.
In relation to the revised Budget 2023 tabled yesterday (Feb 24), he applauded the government’s commitment to providing RM40 billion in financing facilities for micro, small and medium enterprises (MSMEs) through government agencies.
“The financing facilities ease the financial burden on SMEs, guaranteed by Syarikat Jaminan Pembiayaan Perniagaan (SJPP), focusing on sectors such as high technology, agriculture, and manufacturing by up to RM20 billion,” he said.
Ong also welcomed RM100 million by the government for the SME Digitisation Grant Scheme to support business automation and digitalisation activities — where SMEs get RM 90 million, and small traders get RM10 million.
“Matching grants of up to RM5,000 will also be given to SMEs and small traders that subscribe to business digitisation applications such as POS (point of sale) sales, accounting, and inventory management systems,” he enthused.
He pointed out that the RM2 billion for sustainable development in technology, and promotion of carbon reduction for SMEs, and RM1 billion to help SMEs improve automation and digitalisation would encourage the participation of Malaysian youth in entrepreneurship.
Ong also welcomed several measures for SMEs, including the tax rate on taxable income for the first RM150,000 reduced to 15 per cent from 17 per cent for the assessment year 2023.
“This will benefit 150,000 MSMEs taxpayers with tax savings of up to RM3,000 each,” he said.
Concerning tax incentives, Ong said that for SMEs, the present tax rate for the first RM600,000 is 17 per cent.
“Under the new measure, the tax rate for the first RM150,000 taxable income will be 15 per cent, with the next RM450,000 at 17 per cent, followed by above RM600,000 at 24 per cent.
“In this context, I feel that the government could have increased the third threshold from RM600,000 to RM1 million taxable at 20 per cent instead of 24 per cent,” he said.
He opined apart from lowering taxes, the government could have implemented more pragmatic measures to help SMEs defray from a higher cost of raw materials, electricity tariffs, and labour costs, as these are what SMEs are struggling with.
“The tax savings will only be up to RM3,000, but if your company is not profitable, the tax savings serves meaningless if the company is not making profits.
“However, this budget also provides the support most needed to address the high cost of living, further strengthen the social safety net, and boost the MSMEs ecosystem,” he said. — DayakDaily
