What are the main concerns raised by local business groups?

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Local Business Groups Raise Concerns Over Unfair Competition from Foreign Nationals

Local business groups have repeatedly voiced concerns regarding unfair competition stemming from foreign nationals allegedly operating businesses illegally within Malaysia. These concerns are primarily centred on foreign entities purportedly circumventing established tax obligations and regulatory frameworks that are mandatory for local traders. This situation creates a disadvantageous environment for domestic businesses that adhere to all legal and financial requirements.
Allegations of Illegal Business Operations

A significant point of contention highlighted by local business groups is the alleged operation of businesses by foreign nationals who have entered the country on social visit passes. This practice is seen as a direct violation of immigration laws, as social visit passes are intended for tourism and personal matters, not for commercial activities. These operations are reportedly concentrated in various locations, including specific areas within the Klang Valley and operations on Sabah's east coast, leading to direct competition with local enterprises.
Tax Evasion and Regulatory Non-Compliance

Beyond the illegality of operating businesses on social visit passes, foreign nationals are also accused of avoiding the tax and regulatory requirements imposed upon local traders. This alleged non-compliance allows these foreign entities to potentially offer goods and services at lower prices, thereby creating an uneven playing field. Local businesses, bound by Malaysian tax laws and commercial regulations, find it challenging to compete against operations that do not incur similar costs.
Government Directives for Enforcement

In response to these persistent concerns and complaints, the Malaysian Cabinet has directed relevant enforcement agencies to take immediate action against foreign nationals engaged in business activities while holding social visit passes. Ministries including the Home Ministry, the Ministry of Housing and Local Government, and the Ministry of Domestic Trade and Cost of Living have been instructed to intensify their enforcement efforts. The focus is on ensuring that individuals entering Malaysia adhere to the terms of their passes, which generally prohibit work or business engagement.

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What are the main concerns raised by local business groups?

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