KUALA LUMPUR – With economic data showing rising exports, employers can surely afford to give their workers an additional one month’s salary as festival aid, a labour rights group has said.
Social Protection Contributors Advisory Association Malaysia (SPCAAM) president J. Solomon dismissed pushback from employer groups that the aid would be a burden to companies, noting recent figures on trade, tax revenue and economic growth.
“According to the International Trade and Industry Ministry, Malaysia’s exports in January 2024 rose by more than 8.7% from a year earlier to RM122.43 billion, which is more than the 3% growth estimated by experts.
“Overall, according to Malaysia Industrial Development Finance (MIDF) research, Malaysia’s exports are expected to rebound and expand by 4.5% in 2024.
“If businesses and corporations are exporting more, why are they claiming that they are still suffering in the post-pandemic era?” Solomon said in a statement today.
He also cited Inland Revenue Board (IRB) figures which recorded RM175.4 billion in direct tax collected for 2022, a 21.75% increase from 2021.
Of the amount collected in 2022, corporate tax contributed RM97.94 billion, or 55% of IRB’s overall tax revenue for the year.
The T20 group had also contributed 85% or RM33.68 billion of personal income tax IRB collected in 2022, Solomon noted.
“IRB’s collection for the year 2023 was likely even higher, because according to the then-deputy finance minister II Steven Sim, by May 2023 itself, tax collection was already 20% higher compared with the same period in the year before.
“If business owners and corporations are still recovering from the Covid-19 pandemic as claimed (by employer groups), how is it possible for IRB to make such a record haul?” Solomon added.
He also pointed out Malaysia’s economic growth trend since the pandemic, noting that projections for growth in 2023 are likely to be between 4% to 5%.
For the record, Bank Negara Malaysia on February 16 announced gross domestic product growth of 3.7% for 2023.
Solomon said these figures put into question the claims by the Malaysian Employers Federation and the Small and Medium Enterprises Association of Malaysia which had dismissed SPCAAM’s proposal for the one-month festival aid for workers.
These groups had said employers and SMEs were still struggling from the Covid-19 pandemic.
When SPCAAM made the proposal a week ago, Solomon had cited a study by the Employees Provident Fund which found that workers in the Klang Valley spend nearly an entire month’s salary on annual social and festive activities.
He also said giving similar assistance for workers’ festival spending was practised by business owners in Indonesia, and urged Malaysia’s government to mandate the same for businesses and corporations here. – February 25, 2024