KUCHING: With Budget 2020 set to be tabled today, Hubline Bhd (Hubline) hopes that the government will consider providing tax incentives in the shipping industry to the freights that are derived from overseas operations and traded in other foreign currencies.
According to Hubline, shipping income derived from overseas operations should be exempted from tax.
“For example, if the shipping company carries cargo from Indonesian ports to Vietnam ports, the income should be exempted. This is important to help the shipping company to grow and reduce its operating cost,” the group said in a statement to The Borneo Post.
Hubline also said the government should consider to re-introduce the Cabotage Law to protect local shipping companies.
The group noted that this will help to develop Malaysian ownership and local shipping in general whilst at the same time minimising Malaysia’s dependence on foreign vessels as well as the outflow of foreign exchange in the form of freight payments.
“This policy also acts as a platform for local shipping companies to gradually expand and reach out into international waters.”
On what else can be done to further elevate the industry, Hubline highlighted that financing remains an important issue in all industries, and this includes the shipping industry as well.
“Banks should be more lenient in approving loan financing for shipping companies to grow as this is a capital intensive industry especially if when it comes to enlarging capacity for a bigger customer base.”