Talks on incentives for medical device manufacturers ongoing, says Mah

PORT KLANG: Plantation Industries and Commodities Minister Datuk Seri Mah Siew Keong has assured medical device manufacturers' that he is in talks with Finance Ministry to reconsider raising the limit and extending reinvestment allowance for manufacturers beyond 2018.  

"We're in talks with Finance Ministry to reconsider the appeal for reinvestment allowance extension," the minister told reporters, after an official tour of Karex Bhd's condom factory here today. 
The medical device manufacturing sector has been pressing on with their appeal to the government to extend tax incentives, despite earlier rejection under 2017 Budget. 
Under the 2016 Budget, the government has accorded reinvestment allowance to manufacturers, with up to 60 per cent of the allowed capital expenditure for the years 2016, 2017 and 2018. 
Condom manufacturers like Karex have and will continue to pump in a lot of money, time and effort to automate many processes along its production lines. 
"Automation is key to ramping up productivity. Government incentives, such as the raising the limit of reinvestment allowance and extending it beyond 2018, is vital for capital intensive businesses such as ours," said Karex chief executive officer Goh Miah Kiat. 
Manufacturers of medical gloves, Foley catheters and condoms are reiterating their appeal to the government to extend reinvestment allowance as they aggressively reinvest to automate production lines, develop more innovative medical gloves and seize a sizeable chunk of the world's lucrative condom market. 
Mah also said he will forward the proposal to the Ministry of Women, Family and Community Development to consider promoting condoms as first choice of birth control. 
"I will talk to the Minister in charge of family planning about promoting Malaysian rubber as the preferred choice," he said. 
This evening, Karex told the stock exchange its first quarter profits ended September 2016 fell 63.5 per cent to RM8.14 million from RM22.28 million a year ago, due to lower foreign exchange gain. 
The lower profit was also attributed to higher operating, administration and one-off corporate exercise expenses with the consolidation of newly acquired Pasante Healthcare Ltd. Revenue rose 5.2 per cent to RM80.04 million from RM76.09 million, largely due to the consolidation of sales from Pasante.




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