The SME association has welcomed the announcements made in Budget 2023 that would benefit SMEs, including the one-off grant of RM 1,000 for all SMEs, a reduction of the tax rate to 15 percent for the first RM 100,000 taxable income, and the financing facilities made available via SemarakNiaga 2023.
- While it is clear that much of the initiatives are with the upcoming election and micro enterprises in mind, the overall liquidity to be injected and the focus on automation and digitalisation would help support our recovery post-pandemic. It would have been more effective to allow a double deduction for investments into R&D, digitalisation, automation, and ESG compliance, on top of financing facilities. Most SMEs are reluctant to invest substantially in plant and process upgrades due to the current political and economic uncertainty.
- As such, targeted financing facilities such as those announced will not make as much difference as a more complete package of budgetary intervention. SMEs continue to be besieged with low productivity which results in low-profit margins. SAMENTA however said it will continue to work with various government agencies to help SMEs better protect their margins, improve their productivity and navigate the digital economy.
