Malaysia SME Association presses Putrajaya for urgent SST review in wake of US tariffs
The association said the tariff, which affects key industries like electronics, rubber products and medical devices, is severely weakening the competitiveness of export-oriented SMEs.
Its national president, Chin Chee Seong, said the added burden of SST at home has worsened the cost pressures caused by the external trade barrier.
'The 19 per cent US tariff is already putting immense pressure on our export-oriented SMEs, especially in sectors like electronics, rubber products, and medical devices.
'At the same time, the expanded SST has raised operational costs for businesses involved in manufacturing, leasing, logistics, and services — without any form of input tax credit to offset cascading tax effects,' Chin said in a statement.
He warned that without urgent reforms, many SMEs may not survive the dual hit of international tariffs and domestic tax policies.
The group is calling for immediate SST restructuring, including business-to-business exemptions for licensed manufacturers and essential service providers.
It also wants the government to consider bringing back a reformed Goods and Services Tax (GST) that includes input tax credits and lower compliance costs.
Chin said the SST's cascading tax effect and lack of transparency discourage formal business growth and damage supply chain efficiency.
To help offset export losses, the association urged the government to increase funding for market expansion, particularly in the Halal sector and difficult markets like China and the Middle East.
It said SMEs need hands-on support in areas such as branding, regulatory compliance and localisation strategies tailored to overseas markets.
The association also called for faster disbursement of soft loans, digitalisation grants and other financial aid to SMEs hit hardest by the tariff.
Chin stressed that a coordinated tax and export support strategy is vital to keep Malaysian SMEs competitive amid rising global and domestic pressures.
This morning, US President Donald Trump announced the new tariff rate for Malaysia, down from the 25 per cent he initially planned to impose on the country over a trade deficit he believes to be evidence of unfair trade practices.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Free Malaysia Today
6 minutes ago
- Free Malaysia Today
Unexplained wealth orders: powerful but challenging tool, says TI-M
Malaysia lost RM277 billion to fraud, procurement abuse, and illicit flows between 2018 and 2023, according to Charles Santiago. (File pic) PETALING JAYA : An unexplained wealth order (UWO) could be a powerful tool in the fight against corruption—but enacting legislation for it could be fraught with challenges, says an anti-graft advocate. Transparency International Malaysia (TI-M) president Raymon Ram said securing parliamentary approval for a UWO would be difficult, as the mechanism itself appears to undermine fundamental legal principles. 'MPs who might be subject to a UWO might vote against such a law,' he told FMT. Raymon Ram. Raymon explained that under the UWO, the burden of proof is shifted onto individuals to justify their wealth. This contradicts fundamental legal principles, including the presumption of innocence, he added. Under established legal principles, the burden of proof typically rests with the claimant or prosecutor, and every individual is presumed innocent until proven guilty. Nevertheless, Raymon acknowledged that UWOs have 'remarkable potential' in the area of asset recovery and could complement laws such as the Malaysian Anti-Corruption Commission Act 2009 and the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001. He said any legislation enacted should frame the UWO as a civil mechanism — similar to the UK model — to avoid potential constitutional challenges, while still equipping enforcement agencies with meaningful powers. He also said that there was need for judicial oversight to prevent abuse. 'A new UWO system must be built with checks and transparency so it isn't used or weaponised against political opponents,' said Raymon. On Saturday, former Klang MP Charles Santiago urged the government to introduce legislation for the issuance of UWOs to tackle illicit wealth and systemic corruption among the elite. He said the UK recovered £62.9 million (RM390 million) in a single year through the order and related civil actions. Citing official estimates, Santiago said Malaysia lost RM277 billion to fraud, procurement abuse, and illicit flows between 2018 and 2023, or RM55 billion annually, that could have funded schools, hospitals, and food aid. However, Center to Combat Corruption and Cronyism chief executive officer Pushpan Murugiah cautioned that the UWO was 'not a silver bullet that can solve all problems related to corruption'. 'UWOs do not curb corruption by preventing the commission of corrupt acts or addressing the root causes of corruption. It merely provides an easier and faster path towards asset recovery to an extent,' he said when contacted. He also described the UWO as a form of civil forfeiture, characterising it primarily as an investigative tool designed to secure a civil recovery order by reversing the burden of proof. Pushpan Murugiah. Pushpan also pointed out that UWOs are used sparingly in the UK, with investigating agencies reluctant to invoke the law in cases involving complex asset structures. This was on account of the high legal costs they would become liable for if the UWO is overturned. He also said the obscuring in Malaysia of assets through the use of layers of shell companies and proxies may become a major barrier to the adoption of UWOs locally.
The Star
an hour ago
- The Star
Use 'Sulawesi Sea' and not 'Ambalat' to refer to contested maritime area, says Tok Mat
KUALA LUMPUR: Foreign Minister Datuk Seri Mohamad Hasan ( pic ) has urged all parties to refer to the contested maritime area off Sabah as the Sulawesi Sea, not Ambalat – a term, he says, Indonesia uses to reinforce its territorial claims. Speaking in the Dewan Rakyat on Tuesday (Aug 5), Mohamad said the disputed area includes Blocks ND6 and ND7, which Malaysia maintains are within its sovereign waters. 'I wish to draw the attention of this august House to the reference to Ambalat by Indonesia. Their claim covers part of the Sulawesi Sea, including Blocks ND6 and ND7. ALSO READ: Nothing final yet on Sulawesi Sea issue with Indonesia, PM tells Dewan Rakyat 'Malaysia's position is that these blocks fall within our sovereign area, based on international law and the 2002 International Court of Justice (ICJ) ruling. 'Therefore, the accurate reference in line with Malaysia's stance is 'Laut Sulawesi' (Sulawesi Sea), not Ambalat. 'The term Ambalat is Indonesia's nomenclature to strengthen its claim. We should not use it,' he added. Mohamad was responding to a question about the possibility of jointly developing the area, which lies within the 1979 New Map of Malaysia, with Indonesia. He reiterated that the ICJ's ruling on Sipadan and Ligitan had affirmed Malaysia's maritime rights projected from the two islands, which include Blocks ND6 and ND7 – the very blocks Indonesia now disputes. Under international law, particularly the United Nations Convention on the Law of the Sea (UNCLOS) 1982, maritime boundaries are determined based on the low-water line along the coast, not the high-tide mark, Mohamad said. He pointed out that while Malaysia adheres to this principle, Indonesia has claimed otherwise. ALSO READ: Leaders set on resolving border issues, boosting ties He assured the House that Malaysia is handling the matter through peaceful means, maintaining a strong bilateral relationship with Indonesia. 'Maritime boundary negotiations are ongoing under the Technical Meeting on Maritime Boundaries Delimitation between Malaysia and Indonesia, which has been in place since 2005. 'We enjoy good relations with Indonesia; 98% of it is positive. We shouldn't allow the remaining 2% to lead to conflict. 'Let us negotiate that 2% calmly. Surely we don't want to go to war over it,' he added. Mohamad stressed that finalising the maritime boundary remains a government priority and outlined several strategic steps. ALSO READ: Sabah kept in loop on Malaysia-Indonesia Sulawesi Sea Treaty negotiations, says CM They include concluding maritime delimitation with Indonesia through diplomatic, legal, and technical mechanisms; ensuring Sabah's involvement in any decision that affects or borders the state; and safeguarding Malaysia's strategic and security interests, particularly in natural resources, territorial waters, and the Exclusive Economic Zone (EEZ). On Sabah's role, Mohamad said the state government is fully involved in all technical discussions and negotiations. 'The Federal Government works closely with Sabah. Their representatives are included in meetings and technical negotiations on maritime boundaries with Indonesia,' he said. He also welcomed suggestions for officials from Wisma Putra or the Malaysian Maritime Department to brief MPs, senators and Sabah assemblymen to prevent confusion or political manipulation. 'There's no issue with conducting briefings. We can schedule them to ensure everyone understands the matter clearly. 'We don't want this to become a thorn in our side or political fodder, especially with the upcoming Sabah election. 'Let us not allow it to mislead the rakyat, especially our people in Sabah and Sarawak,' he said.
The Star
an hour ago
- The Star
Malaysia ready to send monitoring team to Thailand-Cambodia border if requested, says Anwar
KUALA LUMPUR: Putrajaya is prepared to send a monitoring team to the Thailand-Cambodia border if requested by both countries, says Datuk Seri Anwar Ibrahim. However, the Prime Minister said that the decision regarding military presence for monitoring purposes will be made later as the situation along the borders is currently under control. 'Whether military presence is needed for monitoring will be decided later. So far, the situation remains under control, although it is highly sensitive and tense. 'Currently, we have satellites assisting in monitoring, and there is an agreement that this will be coordinated by the Malaysian Defence Attaché. 'The Defence Attaché, along with Asean countries, is only monitoring from a distance,' he said during the Prime Minister's Question Time at the Dewan Rakyat on Tuesday (Aug 5). He was responding to Rodiyah Sapiee (GPS–Batang Sadong), who asked about Malaysia's role in facilitating peace talks and a ceasefire between Thailand and Cambodia. Anwar also said that so far both countries only requested Malaysia to coordinate further talks among the defence senior officials in Kuala Lumpur, with the decision set to be reached on or by Thursday (Aug 7). In a supplementary question by Rodiyah on whether there should be similar peace frameworks to address such disputes through the Asean Regional Forum, Anwar said that it was still too early to decide. 'In our decision that I conveyed to Prime Minister Hun Manet of Cambodia and Acting Prime Minister Phumtham Wechayachai of Thailand, we want both of them to agree and reach a final consensus, with Malaysia as a witness, and then be supported by all Asean countries,' he added. Earlier, Anwar expressed gratitude to all parties, including Opposition MPs, for their support of the Malaysia-led ceasefire. On July 28, Thailand and Cambodia agreed to an unconditional and immediate ceasefire following a special meeting in Putrajaya chaired by Anwar.
