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5 Key Highlights From

Budget 2020 For
Malaysian SMEs

Malaysia’s Finance Minister, Lim Guan Eng recently

tabled Budget 2020 on 11 October at the Dewan
Rakyat, with the theme “Driving Growth And
Equitable Outcomes Towards Shared Prosperity“.
Here are the Budget 2020 highlights that are
important for any Malaysian SME business owner,
whether you own a retail, restaurant, or service-type
business.

Photo of Minister of Finance, Lim Guan Eng tabling

Budget 2020 at the Dewan Rakyat via Ministry of
Finance/Facebook

GST will not be reintroduced

According to Finance Minister, Lim Guan Eng, the

country’s inPation rate has been reduced to its
lowest level since 2007, with the abolishment of the
6% GST in June 2018 and the introduction of the SST
regime in September 2018.

On the topic of whether or not GST will be

reintroduced:

“To respect the mandate given by the Rakyat in

last year’s General Elections, the Government
does not intend to bring back GST.” – Lim Guan
Eng, Malaysian Minister of Finance

What about the Sales and Services Tax (SST)?

No SST revisions or updates were announced, so

there isn’t much change in terms of the GST and the
SST for SMEs. Phew!

Funding for SME entrepreneurs

The government is allocating the following funds for

small business owners in Malaysia:
RM445 million to support Bumiputera
entrepreneurs in terms of access to `nance,
provision of business premises, and entrepreneur
training
RM100 million for the Chinese community for
small business loans under Program Program
Pembiayaan Usahawan Perusahaan Kecil Komuniti
Cina
RM20 million for Indian entrepreneurs under
TEKUN National’s Skim Pembangunan Usahawan
Masyarakat India (SPUMI)

Enhanced Skim Jaminan Pinjaman Perniagaan

(SJPP)

Minister Lim Guan Eng also outlined enhancements

made to the Skim Jaminan Pinjaman Perniagaan
(SJPP):

RM500 million allocation in guarantee facility for

women entrepreneurs
Government guarantee increase from 70% to
80% and guarantee fee decrease to 0.75% for
Bumiputera SMEs, export-oriented SMEs, and
SMEs investing automation and digitalisation

Two new government funds for up and coming

entrepreneurs

“SME Bank will introduce two new funds where

the Government will provide an annual
interest subsidy of 2% to reduce borrowing
costs…” – Lim Guan Eng, Malaysian Minister of
Finance

The two funds to be introduced by SME bank are:

RM200 million for women entrepreneurs with
loans of up to RM1 million/SME
RM300 million fund to support Bumiputera
SMEs with the potential to become regional
champions (priority given to halal products and
manufacturers with high local content)

Digitalised SME benefits

In a bid to build a Digital Malaysia, the government

will allocate funds to help SMes digitalise their
business operations.

The government will provide a 50% matching

grant of up to RM5,000/company for the
subscription of any of the following services:

electronic point of sale system (e-POS)

Enterprise Resource Planning (ERP)
Electronic Payroll System

The matching grant will be worth RM500 million

over 5 years and is limited to the !rst 100,000
SMEs applying to upgrade their systems.

So, which of these initiatives are you most excited

for as a Malaysian SME entrepreneur? Let us know
in the comment section below!

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