InfoSAWIT, KUALA LUMPUR - Malaysian Palm Oil Association (MPOA) was disappointed because 2024 Budget ignored two significant requests that should actually become the factors to develop the industries.
The two are about to get comprehensively review on palm oil profit retribution and tax incentive for replanting program.
MPOA represents more than 40 percent of total planted plantations in Malaysia. The members are also from big private corporates, such as, Sime Darby Plantation Bhd, FGV Holdings Bhd., and Sarawak Oil Palm Bhd.
Chief Executive Joseph Tek Choon thought that profit retribution which is unexpected would be the burden for palm oil sectors as price takers, not price makers.
He also proposed to the government to re-implement citation tariff in Sabah and Serawak to be 1,5 percent from 3,0 percent which is now available and should increase citation threshold to be RM 500 per ton.
The revision would escalate threshold to be RM 3.500 per ton for smallholders in Semenanjung Malaysia and RM 4.000 per ton in Sabah and Sarawak.
Tariff and threshold review to be, would be very helpful to solve the non-proportional burden that smallholders in Sabah and Serawak are facing.
About tax support in replanting program, MPOA said that tax incentive (which is proposed) would be very helpful to get replanting program that covers 560.000 hectares on the plantations within more than 25 years old in 2027.
“Though 2024 budget would allocate RM 100 million to help replanting program for smallholders in the form of grant and loan, it is predicted that the program would cover less,” Tek Choon said, as quoted from New Straits Times.
Allocation fund - RM 100 million would only be for 7.000 independent smallholders which means, the replanting program would cover about 5.000 to 6.000 hectares or 0,9 percent of old palm oil plantations. (T2)