Bosses willing to pay RM10k for three-year levy

RM30,000 way too much for many SMEs

PETALING JAYA: Industries will be more receptive to a government levy of RM10,000 for three years instead of paying it annually so that employers can maintain skilled foreign workers and groom new skilled workers at the same time, says the Federation of Malaysian Manufacturers.

Its president Datuk Soh Thian Lai said the annual levy of RM10,000 was too high for employers.

“The industries are most likely to accept it if the levy is RM10,000 for three years and not every year.

“RM30,000 for three years is too high. It will impact the SMEs. We hope the government can look at improving the competitiveness of the manufacturing and services industry,” Soh said yesterday.

On Monday, the government announced that skilled foreign workers who have worked in the country for 10 years will need to pay 80% of the levy, with employers bearing the remaining 20% if they decide to extend their service for an additional three years.

However on Tuesday, Finance Minister Lim Guan Eng announced the reversal of the decision, saying that employers would have to bear RM10,000 in full annually to maintain their skilled foreign workers.

Soh said that while industries understood the government’s intention to reduce dependency on foreign workers, it should also allow affected industries to have the extension period to groom and train new skilled workforce.

He urged the government to have a dialogue session with industry players to hear out their proposals.

He said if the RM10,000 levy was imposed for three years instead of annually, he estimated at least 80% of manufacturers or service industry employers would be able to renew it.

“The government can collect the RM10,000 in advance instead of spreading it over three years, which will give it between RM800mil and RM1bil as there are close to 100,000 foreign workers who have worked for at least 10 years,” said Soh.

Malaysian Employers Federation executive director Datuk Shamsuddin Bardan said stakeholders were not consulted before the decision was announced.

He said the levy was also against the principles adopted by many countries, including Singapore, where the levy on skilled employees was lower than other workers.

SME Association of Malaysia president Datuk Michael Kang hopes the government would meet the association to discuss a winwin solution.

“Our original proposal is for the government to allow a threeyear extension period for these workers.

“The main idea is to assist the industries and maintain the productivity with their experience,” he said.

Kang explained that within the extension period, the industries would move in automation and machinery operations and local staff would be trained to operate such equipment.

“This will reduce the dependency on foreign workers,” he said.

Malayan Agricultural Producers Association executive director Mohamad Audong said skilled foreign workers were very productive and a necessity rather than a choice for employers.

“The government should facilitate and not frustrate employers in relation to the recruitment of foreign workers,” he said.

Malaysian Muslim Restaurant Owners Association president Ayoob Khan Muhamad Yakub said the levy would make it difficult for businesses to operate.

“We hope the government will reconsider and revert to the old system,” he said.