PETALING JAYA: The Government will increase the tax rebate for individual PC purchases to promote computer ownership among Malaysians. 

The current RM400 personal tax rebate will be increased to RM500 to increase household PC penetration, Prime Minister Datuk Seri Abdullah Ahmad Badawi announced in his Budget 2005 speech this evening. 

"In the era of rapid ICT (information and communications technology) advancement, efforts have to be intensified to ensure every household will benefit from ICT," he said. 

The Government introduced the tax rebate in the 1998. 

The PC household penetration rate stands at 26% of the five million households in the country. The rate is lower in rural areas, where only 9.6% of households own PCs, according to estimates by the Association of the Computer and Multimedia Industry of Malaysia (Pikom). 

"This will certainly make PCs more affordable," said Pikom deputy chairman Lee Boon Kok, who also urged taxpayers to take advantage of the opportunity. 

Multinational technology giant Hewlett-Packard Co (HP), a leading PC vendor in the country, also praised the tax rebate increase. 

"We laud the move, although it would have been ideal if the amount fell nearer to the cost of a full entry-level PC," said T.F. Chong, managing director of HP Sales (Malaysia) Sdn Bhd, the US company's local operations. 

Such PCs currently cost between RM900 and RM1,000. 

To ensure that everyone enjoys the benefits of ICT, the Government will provide more disabled-friendly ICT-related facilities and improve access to assistive technologies, Abdullah said. 

"The Government is also concerned about the disabled, and will ensure that they can participate in the nation’s development," he added. 

On the ICT business front, measures will be implemented to enhance access to funding for ICT companies and help such companies move up the value chain. 

The Government will allow 100% foreign ownership of venture capital (VC) companies in Malaysia "to increase funding and expertise and promote investments in the ICT sector," said Abdullah. 

The local VC industry welcomed the move. 

"This will encourage more companies to come in and bring in more expertise," said Sarina Karim, managing director of StrataSKY Corp Sdn Bhd, a local company specialising in outsource management, consulting and investments. 

There was also a need to have greater focus on R&D and promote the commercialisation of R&D, Abdullah said, adding that R&D will be focussed on four main fields: Biotechnology, ICT, advanced materials and advanced manufacturing. 

The Government will introduce incentives for public sector researchers and innovators by providing appropriate royalties and equity ownership in entities that commercialise R&D findings, he added. 

Researchers will be given flexibility to undertake research with industry, as well as enjoy extended service after compulsory retirement based on needs, said Abdullah. 

To support these efforts, new sources of growth in the ICT sector will be developed by training skilled manpower, developing technopreneurs, increasing international promotions and providing specific incentives to investors, he added. 

The Government will also continue with its ongoing school computerisation programme and the implementation of the Schoolnet broadband network, which will eventually link all schools. 

Source : The Star  10/9/2004