While payment of salary to staff remains one of the main issue plaguing many businesses, the worries transcends beyond that.
Many business owner are faced with the prospects of shutting down. This is the effect that we are seeing for going into a full week of MCO enforcement. Imagine if its going to be 2 months. God in His mercy forbid that.
The government has been seen as not doing enough at this moment although the first stimulus package had been announced. However until business resume in the next one week or two weeks, the government needs to figure out the slew of stimulus packages to keep these SME businesses afloat or else the next wave of trouble will be economic collapse which we can’t afford it.
Here are some of the wish list of the SME that the Malaysia Government should consider.
1. Bank Negara to give instruction to banks to support next 6 months deferment on repayment of all banking loans , housing loans , hire purchase, OD and other business related loans and facilities.
Immediate deferment of the loan principal payment not only interest, so that businesses has sufficient cash flow to sail through this COVID 19 outbreak period.
Banks should not discredit company who applied for the deferment of loan principal payment by lowering their credit rating or delaying the application as the deferment of loan principal repayment is just one of the temporary measurements to ensure the long term sustainability of the businesses to reduce the possibility of increase in retrenchment that may eventually lead to the overall increase in unemployment rate in the country. This is to help the most vulnerable to survive and provide support to company that serve those populations.
2. Minimum 6 months deferment on all statutory obligation payments like EPF , Socso, HRDF levy and other related payments.
3. Quick soft loan with no collateral to roll out immediately under the stimulus package introduced by the government. Loan Up to 20% of the annual turnover with minimal interest rate to be given.
4. Exemption of the Sales and Services Tax (SST) for all sectors until June 2020 and to directly affected sectors for the whole of 2020.
5. Special incentives or grants to small and medium retail, MICE and food and beverage businesses who uses e-commerce and delivery systems.
6. Lower the corporate tax rate for all the directly affected industry such as tourism, hotel, MICE, service based, F&B and related industry.
7. Double tax deduction to company for salary paid to the B40 group, additional tax deduction for salary paid to local workers, to encourage the continuous employment of the local workers and reduce the possibility of jobs retrenchment. It is with hope that the Ministry of Human Resource will provide the necessary funding support to the company and/or the employees, when in then extreme case where company has no other option but to ask the employees to take unpaid leaves during the critical period.
8. Support SMEs with at least 50% contributions for labour and wage costs.
9. Pass a demand for owners of malls to half their rental immediately or provide financial aid of exemption for 6 months.
Thease are the nine slews of things that the Malaysia Government should take into consideration asap before business reopen to avoid a major meltdown in the market.