SME Association of Malaysia national president Ding Hong Sing said that the substantial financing facilities offered in the budget demonstrates the government’s diligence in studying and understanding the sector’s needs.
“I am very happy with Budget 2024’s proposals for the SME sector. The government shows it is willing to hear our problems and table our proposals,” he told FMT Business.
“I hope the current government will remain stable so that it can continue to help SMEs adopt digitalisation,” he added.
Earlier today, Prime Minister Anwar Ibrahim announced the provision of loans and financing facilities worth RM44 billion under Budget 2024 for micro, small and medium enterprises (MSMEs).
Meanwhile, AMMB Holdings Bhd CEO Sulaiman Tahir said the RM44 billion allocation for SMEs is set to further empower and enhance their competitiveness.
“With RM2.4 billion earmarked for micro-entrepreneurs and small traders through agencies such as Bank Negara Malaysia, Bank Simpanan Nasional and Tekun, this is expected to spur greater opportunities and ease the financial burden of SMEs, which is certainly timely amid the current economic volatility,” he said in a statement today.
CIMB Group Holdings Bhd CEO Abdul Rahman Ahmad, in a statement today, said the group is encouraged to see strong measures to support MSMEs and startups in Budget 2024.
He highlighted in particular the RM2.2 billion in total funding that was allocated to support MSMEs to automate their business processes, digitalise their operations and increase their international footprint.
“In addition, we laud the focus on environmental sustainability and food security with specific allocation for MSMEs that operate within these two crucial areas.
“This will help support their growth and resilience, and subsequently futureproof the socio-economic wellbeing of all Malaysians,” he said.
Unpleasant surprise
One particular stakeholder, however, expressed surprise and disappointment over the introduction of the capital gains tax (CGT) in Budget 2024 today.
William Ng, the president of the Small and Medium Enterprises Association (Samenta), said that the CGT introduction was done without any consultation with other stakeholders from the SME sector.
“We understand that by taxing capital gains, Malaysia will be able to increase its tax revenue and hopefully reduce its debt.
However, he said that the measure must not be introduced at the expense of entrepreneurs and SMEs.
“If we must introduce a tax apart from the politically controversial goods and services tax, we should introduce an inheritance tax or windfall tax instead of a blanket CGT, which would hurt SMEs disproportionately,” he said in a statement today.
As the details of the CGT are not yet finalised, Samenta hopes that the government will engage with all stakeholders including the SMEs prior to its eventual implementation.
He pointed out that despite SMEs doing reasonably well, having grown its share of the gross domestic product (GDP) to 38.4% in 2022, it is still lower than the respective targets of 45% by 2025 and 50% by 2030 as envisioned by the National Entrepreneurship Blueprint.
“We hope that the measures announced today can be fine-tuned so that SMEs are not unnecessarily disadvantaged,” he said.