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KUALA LUMPUR, March 30 -- The National Tech Association of Malaysia (PIKOM) is urging the government to provide more assistance, including a reduction in corporate tax and personal income tax, to employers and employees in the technology sector amid the challenges posed by COVID-19.
Chairman Danny Lee said in a tough operating environment, businesses are struggling to survive and cash flow is tight.
“Reducing (corporate) tax would help free up additional capital to businesses to invest and hire additional employees. The tax reduction should be for years of assessment 2019 and 2020,” he said in a statement today.
Lee also urged the government to reduce the monthly personal income tax contributions of professionals as well as introducing additional rebates and reliefs for the taxpayers.
“This can be in the form of reduction in overall tax rate or increase in personal relief,” he said.
Meanwhile, Lee said there is a need to address the issue of unpaid leave during the movement control order (MCO) period and beyond as business activity would continue to be depressed.
“Rather than lay off staff, providing the staff the opportunity to return to work when the situation improves is a better option. There can be a cap on the maximum amount of days rather than indefinitely placing an employee on unpaid leave,” said Lee.
On the rental exemptions and electricity discounts announced, he said the government should also play a role in encouraging deferment of rental through a tax incentive.
Lee also asked for a waiver of the Sales and Service Tax to provide an additional boost to the companies and reduce overall cost of doing business.
“This will have a catalytic effect and encourage more consumption,” he explained.
He said the government should consider information technology as a necessary enabling service for businesses, whether an essential or non-essential service during the MCO period.
Providing support to businesses would help ensure that the businesses continued to operate and the employees continued to be gainfully employed, he said.
PIKOM is the association that represents the technology industry in Malaysia and has a membership of more than 1,000 active companies.
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