Group representing SMEs, SMIs and entrepreneurs hands over 13-point memorandum to govt seeking targeted assistance

Emmanuel Santa Maria Chin
·5-min read
Workers prepare their shops for business during the conditional movement control order (CMCO) in Jalan Masjid India in Kuala Lumpur May 5, 2020. — Picture by Firdaus Latif
Workers prepare their shops for business during the conditional movement control order (CMCO) in Jalan Masjid India in Kuala Lumpur May 5, 2020. — Picture by Firdaus Latif

KUALA LUMPUR, Feb 9 — A 13-point memorandum has been submitted to the government by a group representing the small and medium businesses community, pleading for targeted measures and an improved stimulus package for them to keep their heads above water.

The group, called the Covid-19 Special Taskforce Secretariat for NGOs of SMEs, Trade & Entrepreneurs, comprises 113 signatories made up of business groups, associations and entrepreneurs all seeking the same resolution.

In thanking the government for providing in total six stimulus plans aimed at softening the impact of the Covid-19 pandemic, the Taskforce said despite all that has been done, more is needed.

“This year 2021, the Permai stimulus of RM15 billion for MCO 2.0 — with 22 initiatives and 10 of them specific to the business community is applauded.

“But we strongly feel much more needs to be done, with both a unified implementation strategy and unbridled urgency,” read their memorandum.

A list of their demands includes the reinstatement of a bank loan moratorium and interest fees waiver for all businesses beginning this month until December 31, 2021, with an option for an additional three months exemption, including a waiver on licensing and assessment charges over the same period.

The group, who noted that the demands being put forward were done following an in-depth study and discussion sessions, also requested an automatic deferment of statutory payments.

These include contributions towards the Employees’ Provident Fund (EPF), Social Security Organisation (Socso), the Employment Insurance System (EIS), sales and services taxes, quit rent, annual and monthly assessments, submissions to the Companies Commission of Malaysia (SSM), contributions to the Inland Revenue Board (LHDN), the Human Resource Development Fund (HRDF) and on foreign worker levy payments.

The Taskforce then suggested workarounds to these exemptions which include relevant government agencies enforcing the automatic deferment, while not imposing penalties, extra interest rates, and allowing companies to repay the sum owed through instalments.

It also requested that the foreign worker levy be halved until the end of the year, and separately for payments for insurance premiums to be deferred for a year but without removing the offered protection.

The Taskforce also requested the government take on a 50 per cent subsidy on electricity bills for businesses until December 31 this year, and for broader implementation of the assistance.

Also among their requests was for the government to increase the payouts for the wage subsidy programme from the current RM600 to RM1,200, for it to apply to companies with more than 500 employees and for the programme to last for the remainder of the year.

“From all available data the RM 600 subsidy was 26 per cent of the median wage while an RM1,200 subsidy was 51.2 per cent of the median wage.

“Our request is also anchored on the fact that the current RM1,200 is base minimum wage,” read their memorandum.

The Taskforce also requested for soft loans to be offered to businesses the amount of which would be decided on their average six-month costs in pre pandemic settings, while also ensuring the criteria and approval requirements like credit scores are made more lenient in a time of crisis.

Other requests include the implementation of a ‘single-window’ method for businesses seeking assistance from the government which currently involves applications across multiple ministries, and for the Finance Ministry and Bank Negara Malaysia to give their mandate to commercial banks to allow a standardised approval and tracking method.

“At times of crisis — we can’t have a slew of agencies and ministries working in silos and then coming up with plans and directives that may cancel out each other’s and net result may not be as effective as intended by the government.

This (single-windowed) is the same alignment that the MKN (National Security Council) has taken — they take control and there is a single point of command.

“We need the same thing — we need that single command and control centre for business and financial plans that the government has rolled out,” they wrote.

They also pleaded for the government to review the criteria for allocations given under the DanaJamin loan initiative, asserting those not fulfilling the requirements have been granted approval for this aid, and for a Special Relief Fund to allow the roll out of these special loans.

Other requests include a three-way rental relief programme with the tenant, owner, and government all paying equal thirds with tax incentives later offered to the property owner, and for a leeway and 12-month extension for their monthly tax payments required by LHDN.

The final few requests include a time extension for all submissions of annual reports and other statutory reporting to SSM until the end of the year, a plea to the government to not introduce any new taxes to the industry, and finally, to allow all sectors to resume operations under strict standard operating procedures.

Among the signatories of the Taskforce are Malaysian Association of Amusement Theme Park & Family Attractions president Tan Sri Richard Koh and Malaysian Hotel Owners Association president Tan Sri Teo Chiang Hong, Malaysia Digital Chamber of Commerce president Chris Daniel Wong and Datuk Ameer Mydin, president of the Bumiputera Retailers Organisations.

Other names include the Malaysian Muslim Restaurant Owners Association president Datuk Jawahar Ali, president of the Malaysia Hairdressing Association Michael Poh, the president of the Malaysian Footwear Manufacturers Association Rachel Foo and Datuk Azlin Ahmad Shaharbi, president of Peniagawati Malaysia.

Their memorandum was addressed to Minister of International Trade and Industry Datuk Seri Mohamed Azmin Ali, Minister of Defence Datuk Seri Ismail Sabri Yaakob, Finance Minister Datuk Seri Tengku Zafrul Abdul Aziz, Datuk Seri Wee Ka Siong as transport minister, Human Resources Minister Datuk Seri M. Saravanan, Minister in the Prime Minister’s Department Datuk Seri Mustapa Mohamed, Domestic Trade and Consumer Affairs Minister Datuk Seri Alexander Nanta Linggi and Tourism, Arts and Culture Minister Datuk Seri Nancy Shukri.

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