A TOURISM bank, Covid-19 reliefs for manufacturers and tax exemptions are on the wish list of trade associations and business guilds for Budget 2022.

The budget will be tabled by Finance Minister Tengku Zafrul Tengku Abdul Aziz on October 29.

Tourism players were among the worst-hit by lockdowns imposed against the epidemic’s spread and need funding assistance in the form of incentives, tax exemptions and grants to get back on their feet, Malaysian Inbound Tourism Association president Uzaidi Udanis said.

“Next year will be very critical for us. (It will be a year to see) how we can get up and start moving forward. A lot of our players have been paralysed. Some have closed down.

“If tourism can recover next year, I am sure we can do a lot more by 2023,” Uzaidi told The Malaysian Insight.

Five areas the budget should look at for the sector are tourism products, research, marketing, digitalisation and regulatory aspects, Uzaidi said.

The Finance Ministry should also incentivise commercial banks to provide loans to tourism players.

“Banks are a bit hesitant because they think the tourism industry is high risk.”

As such, he proposed a tourism bank, similar in concept to Agrobank, which caters to the agriculture sector.

“If commercial banks are still very conservative, it is about time for us to see how we can set up a tourism bank,” Uzaidi said.

The kind of help tourism players currently need are loans for the cost of maintaining their fleet of tour vehicles, and even road tax renewals.

“Some operators need loans to refurbish tour buses. The sector has about 6,000 buses. Who would be willing to give loans for that?”

Manufacturing

Federation of Malaysian Manufacturers (FMM) president Soh Thian Lai said this sector must continue to be supported as they restart their recovery journey, in line with the nation’s transition from an epidemic into the endemic phase.

“Budget 2022 initiatives would be instrumental in the recovery process of the industry and the economy moving forward.

“Manufacturing must continue to be supported as the catalyst of growth, main contributor to exports and main source of demand for output from the other economic sectors,” Soh told The Malaysian Insight.

For business support, Soh said the government should continue funding assistance including loan moratoriums, tax exemptions to companies affected by prolonged closures, a competitive tax regime, one-off tax exemption on 50% income generated by online business and employment initiatives such as wage subsidies.

He also proposed Covid-19-related expense relief such as a double-tax deduction for booster shots, Covid-19 screening. hostels or workers’ accommodation upgrading and developing a centralised labour quarters.

FMM’s other proposals include help for small and medium enterprises to advance in automation and digitalisation. This can be in the form of increasing grants and waiving import duties on machinery and machine parts.

Also important is the rollout of affordable and good quality broadband access for industries, Soh added.

FMM also wants greater incentives for research and development, and proposed a Future Manufacturing Fund worth RM100 million to RM200 million to support research and development work by universities and implementation by the manufacturing sector.

Soh is also hoping for other measures that will support trade, including assistance for logistics costs, warehousing and freight.

He said sea freight rates have increased during the pandemic, posing a dilemma to shoppers who stand to lose export markets and revenue.

“Allow double-tax deduction on logistics expenses including transportation, warehousing and freight to assist Malaysian shippers (importers and exporters) to remain competitive,” he said.

Construction

The construction sector, meanwhile, wants big projects to start soon.

The Master Builders Association Malaysia (MBAM) has said it also wants tender processes to be expedited.

“It is hoped that mega infrastructure and construction projects that can help the people, such as the construction of roads, affordable housing, bridges, schools and hospitals for next year will be distributed immediately to contractors,” MBAM said in a recent statement.

Other suggestions included the extension of moratorium for businesses and tax incentives and subsidies for new construction machinery.

To ease cash flow, MBAM suggested that financing cost for construction projects be reduced through interest subsidy or government guarantee for project loans to lower the cost and ensure viability.

It also called for an end to red tape at government departments, which can be done by doing away with time-consuming administrative procedures.

For workers in the construction sector, MBAM said the government should provide suitable land for workers’ accommodation, as well as infrastructure and facilities such as electricity, water and communications. – October 4, 2021.