KUALA LUMPUR (Aug 7): The National ICT Association of Malaysia (PIKOM) has called on the government to exempt ICT products from the sales and services tax (SST) and to give tax-free status to Multimedia Super Corridor (MSC)-status companies.

It also hopes the government will implement the venture capital incentives announced in Budget 2018. 

In a statement today, PIKOM chairman Ganesh Kumar Bangah said the association is highlighting these areas of concerns to the government, so it could put to rest uncertainties within the ICT industry and ensure least disruption in the industry's growth. 

"As the voice of the ICT Industry, PIKOM is seeking clarity on these concerns for the benefit of the association’s 1,000 plus members who contribute 80% to the industry’s revenue, which in turn makes up about 19% of the GDP of the country," Ganesh said. 

"During his previous tenure as the Prime Minister, Tun Dr Mahathir Mohamad emphasised the importance of technology for the growth of the country, through initiatives such as the MSC. PIKOM would like to see this emphasis continuing in the new administration," he added. 

Prior to the introduction of the goods and services tax (GST), a majority of the ICT products were exempted from SST, which included personal computers, printers, peripherals, projectors and related multimedia products, he said.

As such, PIKOM hopes the government will include all ICT products and services in the list of products exempted from the SST that is due to take effect on Sept 1.

Ganesh highlighted that the suspension of the MSC Malaysia status application and the resulting changes expected in the Bill of Guarantees (BoGs) are also a cause for concern. 

"As the BoGs were developed to attract investments in the ICT sector, prolonged suspension of the application for MSC Malaysia status will create a business climate of uncertainty among investors. PIKOM is seeking clarity on this matter, as the continuing growth of the ICT industry depends on a conducive investment-friendly environment in the country," he said. 

The status on a slew of incentives announced in Budget 2018 to encourage venture capital activities, has yet to be confirmed, Ganesh noted. 

"The need for intervention and incentives for investments in early-stage and growth-stage businesses are imperative for the development of start-ups, to ensure these companies thrive to the fullest potential," he added.