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Pensonic calls for strategic gov’t support, tax deductions in Malaysia’s Budget 2025

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Publish date: Mon, 14 Oct 2024, 08:22 PM

HOME-GROWN manufacturer and distributor of electrical home appliances Pensonic Holdings Bhd has a list of Budget 2025 recommendations that it deemed as essential for building a robust ecosystem for local brands to thrive domestically and internationally.

A cornerstone of Pensonic’s wish list is the need for advanced technology adoption and automation in the local manufacturing sector.

Pensonic is calling for capital expenditure (capex) grants and tax incentives that will encourage local manufacturers to embrace technologies such as artificial intelligence (AI) and automation systems.

Additionally, the company recommends that the government offer special tax rates or rebates for local manufacturers. These targeted tax incentives would ensure that Malaysian brands maintain their competitive edge over international competitors in the manufacturing space.

Pensonic further urged the government to introduce a special accelerated capital allowance (ACA) rate for machinery used in the production of electrical products, reflecting on the ACA provided for ICT (information communications technology) equipment and customised software.

This allowance would enable local manufacturers to quickly write off investments in machinery while encouraging further technological advancement and improving productivity in the sector.

In line with building a sustainable manufacturing ecosystem, Pensonic is also advocating for the government to take on a more active role as an investor.

Cutting red tape

By setting up state-backed investment funds focused on supporting Malaysian manufacturers, the government can help drive the expansion of local brands into global markets.

“This ecosystem building approach should also encompass upskilling programmes, infrastructure development and access to global distribution networks,” Pensonic pointed out.

“By addressing these gaps, Malaysia can build a fully integrated manufacturing ecosystem that allows local brands to overcome challenges in exporting and scaling their products to international markets.”

Besides that, Pensonic emphasises that in order to support Malaysian brands in scaling globally, it is critical to address bureaucratic obstacles that hinder growth.

Towards this end, the company which has been listed on the Main Market of Bursa Malaysia since 1995 proposed that the government establish a specialised taskforce to fast-track approval processes for businesses with high global growth potential.

“This taskforce would play a pivotal role in removing bureaucratic barriers and simplifying procedures, making it easier for businesses to scale and expand internationally,” suggested Pensonic.

With e-commerce playing an increasingly significant role in modern commerce, Pensonic also expressed belief that the government should offer tax rebates or deductions for digital marketing expenditures.

“This would encourage local companies to invest in expanding their digital presence, thus enabling local brands access to global markets or tap into e-commerce opportunities more effectively,” noted the company founded in 1965 as Keat Radio and Electrical Co in Penang.

“By widening the scope of tax deductions to cover all stages of the export process – from manufacturing to sales – the government can incentivise more local companies to enter the international market. This would make Malaysian products more competitive and accessible on the global stage.”

At the close of today’s market trading, Pensonic was unchanged at 50 sen with 10,100 shares traded, thus valuing the company at RM79 mil. – Oct 14, 2024

 

https://focusmalaysia.my/pensonic-calls-for-strategic-government-support-tax-deductions-in-malaysias-budget-2025/

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