Malaysia Budget 2020: SMEs and Entrepreneurs Get More Supports
Small and medium enterprises (SMEs) and entrepreneurs were among the groups that will benefit from Malaysia Budget 2020.
Amongst other initiatives, RM 455 million will be allocated for Bumiputra entrepreneurs.
Chinese community entrepreneurs would receive a total of RM 100 million loans with 4% interest. Similarly, Indian community entrepreneurs are to get RM 20 million, which will also come with 4% interest.
In an innovative development, the SME bank will introduce two new funds. RM 20 million will be for women entrepreneurs and another RM 300 million to support Bumiputra SMEs who are likely to become regional champions.
Malaysia Budget 2020: Malaysian Digital Economy Corporation
Meanwhile, a total sum of RM 70 million was reserved for the Malaysian Digital Economy Corporation. This is to build 14 states of the art Digital Enhancement centres in every state. The idea is to make possible the financing and capacity building of businesses with a major focus on SMEs.
Also, the Market Development Grant (MDG) ceiling by Malaysia External Trade Development Corporation (Matrade) was upgraded to RM 300,000. There was also a change in the ceiling of participation in export fairs. It was improved from RM 15,000 to RM 25,000, while another RM 50 million went to SMEs. This is to motivate them to be part of these promotional activities.
Malaysia Budget 2020: Strong Support For SMEs
Malaysia budget 2020 strongly favours SMEs as the country counts down to the Shared Prosperity Vision (SPV) 2030.
This is the best budget for SMEs as the nation nears the end of the 11th Malaysia Plan and gearing towards the 12th Malaysia Plan and the SPV 2030. The government is looking at how to boost SME contribution to the GDP from the present 38% to 50% by 2030.
SMEs now have a one-stop centre after the announcement of the Digital Enhancement Centres in all states. The limit for chargeable income to be taxed at 17% be increased. From RM 500,000 to RM 600,000, but the SMEs must not have a paid-up capital of more than 2.5 million maximum and annual sales must not exceed RM 50 million. This is to ensure the lower income tax rate benefits only the eligible SMEs.