Lim Guan Eng urges moratorium on taxes, subsidies for MSMEs amid Anwar’s austerity package

 

DAP’s Bagan MP Lim Guan Eng has urged the government to accompany austerity measures with a moratorium on tax hikes. — Picture by Sayuti Zainudin

KUALA LUMPUR, March 13 — DAP’s Bagan MP Lim Guan Eng has urged the government to accompany austerity measures with a moratorium on tax hikes, regulatory costs and compliance burdens, alongside targeted subsidies for micro, small and medium enterprises (MSMEs) struggling with rising operational expenses.

Lim noted that while Prime Minister Datuk Seri Anwar Ibrahim’s austerity package maintained the Budi95 fuel subsidy, restricted overseas travel and cancelled Hari Raya open houses, he stressed the measures were insufficient to shield vulnerable groups and industries.

“Austerity measures should be accompanied by a moratorium on increased taxes, regulatory and compliance costs as well as targeted subsidies for Micro Small and Medium enterprises or MSMEs affected by rising operational costs,” Lim said in a statement today.

“Increases in SST, e-invoicing compliance and 2 per cent EPF contributions for foreign workers effective since late last year should be immediately suspended,” he added.

The former finance minister said Malaysia needed a reset in regulatory and tax policies to help MSMEs overcome soaring costs and labour shortages, including liberalising foreign worker recruitment. He warned that foreign competitors were applying “ferocious price-cutting known as ‘involution’” to capture market share and drive local firms out of business.

Lim suggested Malaysia follow Asean neighbours by requiring both domestic and foreign investors to source at least 50 per cent of products locally, unless unavailable. He cautioned that failure to protect the country’s 1.1 million MSMEs — which make up more than 96 per cent of all businesses — would undermine political stability and erode support for the government. - malaymail