KUALA LUMPUR, Nov 2 ― The Master Builders Association Malaysia (MBAM) urged the government today to apply a reduction in foreign workers’ levy to the construction industry, after it was announced for the agriculture and plantation sectors.
Finance Minister Lim Guan Eng announced today during the tabling of Budget 2019 that the government would reduce the extension levy for foreign workers who have served for 10 years or more from RM10,000 to RM3,500 per worker per annum in the agriculture and plantation industries, due to a shortage of workers and decline in prices of the commodities.
“There should be a realistic understanding that the construction industry needs workers to fill in the demand-supply gap for manpower in the construction industry.
“As such, MBAM hopes that the policy with regards to the employment of foreign workers can be looked at in a holistic manner so that the aspiration of both the public and the private sector can be satisfied and the cost of doing business reduced,” MBAM president Foo Chek Lee said in a statement.
The finance minister also said the government planned to implement a new tiered levy system for migrant labour, where the levies charged will be higher for employers with a higher percentage of foreign workers.
“We also fully support the government’s two-tiered system and hope that the levy can be reduced for the skilled workers to further improve construction productivity,” MBAM said in response.
MBAM also expressed concern about the implementation of the sales and services tax (SST), noting that the construction industry typically had variations and a project’s final accounts could only be finalised one to two years after the defect liability.
“The other uncertainty is for those facing the difficulty to account on their final account but contractors are required by the government to settle the GST (goods and services tax) fee before end of this year.
“MBAM strongly urges for the government to consider allowing a two years’ grace period for contractors to settle the full GST fees in these circumstances.”
