Initiatives to help micro-enterprises and SMEs to recover welcomed


PETALING JAYA: Some initiatives of the 2022 budget are considered essential to the turnaround of local small and medium enterprises (SMEs), namely microcredit loans at 0% interest rate, deferral of income tax installments, reinvestment allowance (RE) and RM 40 billion Semarak Niaga. .

The general treasurer of the Associated Chinese Chamber of Commerce and Industry of Malaysia (ACCCIM) and the chairman of the SME committee, Koong Lin Loong, said that microcredit loans of up to RM75,000 at an interest rate of 0% for the first six months of the loan term, with a six-month moratorium term, is a good government initiative and a beneficial initiative to support and assist microenterprises. This is a continuation of Prihatin SME Plus from last year.

In addition, under the SME funds of Bank Negara Malaysia, the Targeted Relief and Recovery Facility was increased by Ringgit 2 billion from Ringgit 6 billion.

“This is a popular demand from SMEs. I think RM 2 billion is too low because SMEs have entered the recovery phase. This is an important step for SMEs to move forward. If the government can help SMEs, they can move forward, then there will be no more layoffs and bankruptcies, ”Koong told SunBiz.

He said ACCCIM had fought for the deferral of income tax installments, which the government ultimately approved.

“Businesses should request a deferral of installment payments for MSMEs (micro, small and medium enterprises) for six months until June 30, 2022. This is a good way to save cash. Revising the monthly tax payment is a laudable move by the government, in which all businesses are allowed to change the income tax estimated to be paid on the 11th month before October 31, 2022, ”he said. .

During the pandemic, many businesses suffer losses. Previously, tax treatment of accumulated unabsorbed business losses could be deferred for seven consecutive tax years. Now it has been revised for up to 10 consecutive years of assessment.

“This means that companies can establish future taxable profits for 10 years. It’s good for businesses. “

He advised SMEs to be aware of the tax advantages made available by the government.

“If SMEs take the opportunity to automate and modernize the business tool, they will be entitled to the BRP, the BRP has been extended for two years. I advise SMEs to apply for all the funds and tax benefits announced in the budget. If SMEs opt to renovate or refurbish premises to comply with Covid-19 SOPs, they will be entitled to a maximum of RM300,000 in tax deductions. “

He said several funding measures for startups announced by the government were innovative.

“For example, government support for crowdfunding and peer-to-peer lending platforms with an allocation of RM80 million in matching grants for the Malaysian Co-Investment Fund. In addition to the investment of Bank Pembangunan Malaysia Bhd totaling RM100 million.

“In addition, financing for companies with high debt or companies facing debt problems are innovative measures such as the allocation of RM 2.1 billion to support fund investment programs equity and quasi-equity run by SME Bank in collaboration with Teraju and BSN with a fund worth RM 600 million for all companies. However, we do not yet know the execution processes of these funds ”, did he declare.

Malaysian Associate Indian Chambers of Commerce and Industry Secretary-General, Dr AT Kumararajah, said that although the budget has been expansionary, it will only succeed if it is applied to the most needed, the coup de inch that SMEs were hoping for.

Semarak Niaga’s 40 billion RM, which includes the 14.2 billion RM, will hopefully go to SMEs in dire need of cash. The 14.2 billion ringgit out of the 40 billion ringgit for SemarakNiaga is another chance for SMEs to bounce back in 2022. The government managed an expansionary budget in the short term and linked it to necessary structural reforms such as the fiscal discipline and public sector spending. medium-term reforms is a step in the right direction.

Setting up the new SPV for large companies for recapitalization is hopefully not a rescue but will capitalize high impact companies.

“The SPV must also be created for MSMEs, because they need it the most. Also, we need a new credit reporting system, ”he told SunBiz.

Other laudable initiatives are the six-month tax break which will give businesses the necessary cash flow ease. Tax relief for SOP compliance is welcome as the cost of doing business will be lower. The Syarikat Jaminan Pembiayaan Perniagaan is a good shot with wider coverage.

“The government needs to consider a new paradigm for reaching businesses, especially SMEs and the micro-business community,” he said.

Without bending to conventional thinking of budgetary discipline, he said, continued support must be made available to the business community with targeted relief and to the sensitive person with an adequate support system. He said SMEs need a one-stop-shop, which was done in part with the SPV for recapitalization.

“The government needs to do more to build consumer confidence because 70% of our GDP is domestic. The very fact that fear persists, the threat of an unshakeable wave ahead is not good for business and consumer confidence, because when it comes to big decisions, both on spending and on investments, this kind of environment creates fear and does not give confidence to consumers as well as businesses.

“In addition, the public-private partnership 3.0 must be improved and less dependent on the government. The post-covid economy must be led by the private sector and propelled by the government, ”he said.

He said the government’s distress funding model needs to be reassessed and come up with a new funding model that excludes banks as a solution.

Malaysia Small and Medium Enterprises Association central chairman Datuk William Ng said the budget is pro-growth and timely to support businesses, especially SMEs, in the post-pandemic recovery .

“We are pleased that the government has heard our plea for a wage subsidy for the rehiring of workers. This is crucial because most SMEs that are in a recovery mood are strapped for cash to source raw materials and rehire workers. This has now been advertised as JaminKerja with a subsidy of up to 30%.

“For cash-strapped SMEs, we are pleased that the government has announced measures such as the down payment on corporation tax, as well as additional funds of up to RMB 40 billion under the SemarakNiaga initiative, ”he said in a statement.

The business community has sighed with relief that no new taxes have been imposed on businesses when most businesses are struggling and only starting to recover.

“However, we remain hopeful that our proposal to award 30% of public procurement to SME vendors will still be considered by the government for implementation in 2022. This would not imply any additional budget or funds from the government. , because procurement concerns products. and the services required by the government, ”he said.

Malaysian Industrial Development Financial Bhd Group Managing Director Datuk Charon Wardini Mokhzani said supporting and strengthening business activities, especially for MSMEs, received special attention.

“Accessing finance with various loans and financing and credit guarantee programs has been made as one of the key initiatives to ensure that businesses, especially MSMEs, will be able to recover and thrive after going through a difficult time this year. “

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