The National ICT Association of Malaysia (PIKOM) made several proposals for consideration in the upcoming Budget 2018. These recommendations will provide a needed boost to the country’s digital economy, said Chin Chee Seong, chairman, PIKOM.
Propagate a Digital Ready Workforce
To support Malaysia’s digital economy, a greater number of Science, Technology, Engineering, and Mathematics (STEM) students are needed. The government should strongly promote STEM or courses relevant to Industry 4.0 among secondary- and tertiary-level students.
PIKOM recommends the government providing STEM student with a stipend or monetary incentives to pursue additional online courses, purchase technology and procure additional resources. It also proposes corporate tax incentives for companies that provide scholarships for computer science, software engineering and STEM-related courses; and companies that train employees to obtain professional certification in critical core areas such as data science, artificial intelligence, cybersecurity and others.
Remove Withholding Tax on Software
Under the Finance Act 2017, software is subject to withholding tax, which has had a detrimental impact on the local software industry. Compounding the issue is the uncertainty surrounding the application of withholding tax on software prior to 2017, PIKOM said.
PIKOM recommends that software should not be subject to royalty for mere use or right to use. It also proposed for the tax to not be imposed retrospectively.
Increase use of ICT in government
PIKOM recommends that the government should accelerate its use of disruptive ICT technologies such as hyperscale public cloud, advanced analytics, mobile, social, artificial intelligence, IoT, blockchain, and others, to not only improve public service delivery and reduce operational cost, but to also serve as a catalyst and confidence booster for the private sector to adopt these technologies.
Make ICT more affordable for every Malaysian
PIKOM said making ICT hardware and software affordable and accessible is vital towards creating an educated and informed nation, whose population is not left behind in the new digital era.
It recommends that ICT products and services, especially for big-ticket items such as laptops and smartphones be GST zero-rated. It also suggests a tax relief of RM3000, exercisable annually, for PCs, tablets, and smartphones.
PIKOM wants the government to reintroduce the EPF Computer Purchase Withdrawal Scheme which was discontinued in 2002.
It is also asking for the cost of broadband services to be reduced to be on par with other countries. Although speeds have increased over the past few years, prices have not gone down.