KUALA LUMPUR: The RM2,000 minimum wage exemption for micro, small and medium enterprises (MSMEs) with annual sales revenue below RM50 million in the 2027 Budget, effective June next year, would help businesses adjust their workforce recruitment and salary structures, said SME Corporation Malaysia.
Its chief executive officer Rizal Nainy said the exemption would give MSMEs room to align their operations with automation and digitalisation, which could improve productivity and reduce operating costs, particularly labour expenses.
"I believe that during this short-term period, as MSMEs adjust to the RM2,000 minimum wage, the government needs to introduce targeted interventions by looking at the digitalisation and automation programmes that can be made available to these businesses.
"It is also an opportunity for MSMEs to explore how automation and digitalisation can complement their workforce, ensuring that the higher wages they pay for skilled talent translate into greater value, rather than relying on low-skilled labour," he said.
Rizal said this when appearing as a guest on Bernama TV's The Nation programme, titled "Budget 2027: What It Means for MSMEs", hosted by Jessy Chahal today.
On Oct 9, Prime Minister Datuk Seri Anwar Ibrahim announced in the 2027 Budget that the minimum wage would be raised to RM2,000 per month from RM1,700 per month, effective June 2027, benefiting more than four million workers.
He said SMEs with annual sales revenue below RM50 million would be temporarily exempted from implementing the new minimum wage of RM2,000 per month.
Additionally, Anwar said loan facilities and financing guarantees for MSMEs would be increased to RM57 billion next year from RM50 billion, while the corporate income tax rate for eligible MSMEs would be reduced by one percentage point in the 2027 Budget.
Meanwhile, Rizal said the record RM57 billion allocated for MSME financing facilities under the 2027 Budget would help businesses expand their operations, scale up and contribute more significantly to the country's gross domestic product.
"2027 is the year of MSMEs, and I believe the 2027 Budget will provide significant support for the sector.
"I hope MSMEs obtain the right information from the right sources and, more importantly, understand how to benefit from the budget to expand and scale up their businesses.
"Under the 13th Malaysia Plan, our agenda for MSMEs is about scaling up.
"We want to see micro enterprises grow into small businesses and small businesses progress into medium-sized enterprises," he added. — BERNAMA
© New Straits Times Press (M) Bhd