KUALA LUMPUR, Oct 25 — The government is proposing a RM120 million allocation for an integrated package to increase innovation and productivity of small and medium enterprises (SMEs).

Prime Minister Datuk Seri Najib Razak said the package will provide financing for mechanisation, automation and upgrading SMEs’ capacity.

He said the Government also provides various assistance and incentives under the Green Lane Policy programme for financing, tax incentives and procurement including subsidy on interest rate of two per cent, or a maximum of RM200,000 a year and stamp duty exemption for loan agreements under the soft loan incentive scheme.

“The government plans to extend these incentives until December 31, 2017,” he said when tabling Budget 2014 in Parliament today.

He said the incentives will also include tax deduction on expenses incurred for obtaining 1-InnoCERT certification, government procurement incentives encompassing approved manufacturers status company registration without site visit as well as bonus marks given in technical evaluation and priority incentives to participate in procurement exercises by the Minister of Finance Incorporated companies.

Najib also said the government proposes that the difference in the wages paid by employers for the period between January 1, 2014 and December 31, 2014, be given further tax deduction.

“To help night market traders, the government will create a Night Market Traders Entrepreneur Scheme with a RM100 million allocation under Bank Simpanan Nasional.

“The soft loans will carry a four per cent interest rate, with maximum loans of up to RM30,000. The facility is to cover business costs such as revolving capital, site rental, raw materials and business equipment,” he added. — Bernama