GEORGE TOWN: Lower cost of operations and reduced corporate and personal income taxes top the budget wish lists of Malaysian American Electronics Industry (MAEI), Penang Engineering Foundry Industry Association (PENFEIA) and investPenang this year.
MAEI chairman Datuk Wong Siew Hai told StarBiz that the budget should give rebates to electronic companies that were able to use electricity efficiently for the production of high-value products.
“This will help lower the cost of doing business in the electronic sector.
“The budget should also allow good-performing electronic companies to renew their licences for a longer period to cut operational costs,” he said.
“Presently, a normal-size electronic factory has about 100 licences that need to be renewed yearly. If these companies have been performing for three years, then their licences should also be renewed for three years.”
Wong said as the global economy was softening, the budget should also provide incentives for the electronics sector to retrain its workers.
“This will enable the industry to be ready to take in new high-value design and development jobs when the economy recovers,” he said.
PENFEIA president Datuk Ng Chai Eng said sales tax exemption scheme for small and medium enterprises (SMEs) should be raised to RM1mil from RM100,000 presently.
“This will improve the competitive edge of SMEs making less than RM1mil per annum. The present sales tax exemption scheme is outdated and has not been revised for at least 30 years,” he said.
Meanwhile, investPenang executive committee chairman Datuk Lee Kah Choon suggested the present chargeable income tax for SMEs be raised to RM1mil from RM500,000.
“Currently, SMEs with a paid-up capital of RM2.5mil and below are eligible for a reduced corporate tax of 20% on the chargeable income of up to RM500,000,” he said.
Speaking at a media briefing, Lee said the Government should impose a standard income tax rate for all knowledge workers in the country.
“Resident knowledge workers in respect of all specified qualifying activities in Iskandar Malaysia now enjoy a tax rate of 15% of an individual’s chargeable income.
“This privilege should be extended to all knowledge workers in the country,” he said.
Lee also proposed for the minimum taxable income to be brought up to RM30,000 to alleviate the inflationary effect of subsidy cuts and the forthcoming implementation of Goods and Services Tax.
Currently the minimum taxable income is RM25,000.
He said the Government should also lift the curtailment of gas supply through gas pipelines.
“There are gas pipelines to the factories in many industrial zones. But these factories do not get the supply of gas due to the curtailment imposed by the Government.
“To make Malaysia’s industrial park competitive internationally, (the Government must) ensure all industrial parks are supplied with natural gas,” he said.
Lee also hoped that the Government would provide matching grants for the maintenance of industrial parks in the country.