Small and medium firms meet premier over industry needs

Representatives of the nation's small and medium-sized enterprises (SMEs) yesterday urged the government to ease tax and foreign employee regulations to enhance business competitiveness.

"Research and Development fees should be tax-deductible," Roscher Lin (林秉彬), chairman of the National Association of Small and Medium Enterprises (NASME, 中小企業協會), told reporters yesterday after a meeting with Premier Chang Chun-hsiung (張俊雄). "But the different interpretations of local tax agencies result in different standards."

In addition, SMEs have difficulty applying for foreign employees since the Council of Labor Affairs changed regulations, which has hurt the food industry in particular, he said.

Fifty business representatives from NASME and the Taiwan Federation of Industry (TFI 工業協進會) met Chang to discuss challenges facing their firms.

As for the Statute of Upgrading Industries (促進產業升級條例), which is set to expire on Dec. 31, 2009, Lin said SMEs were hoping the government would exclude tax on higher acquisition costs.

Lin said the association was working on proposing concrete measures by June or July.

Chang said the government would analyze problems NASME identifies and have the Small and Medium Enterprise Administration act as a negotiator to reach a compromise.

"There are some problems that have already been resolved," Chang said after the meeting.

Minister of Economic Affairs Steve Chen (陳瑞隆) said many issues discussed at the meeting were interdepartmental problems.

Chen echoed Chang's statement, adding that "having such a system will enable the Ministry of Economic Affairs to assist through interdepartmental negotiations."

According to government statistics, there were a total of 1.244 million SMEs in Taiwan last year, representing 97.77 percent of the nation's total businesses. SMEs employed 7.751 million people, representing 76.66 percent of the nation's work force.

Despite rising international oil prices and the US subprime housing loan crisis, Taiwan's exports reached US$201.41 billion in the first 10 months of the year, Chang said.

The jobless rate hit an eight-year low of 3.92 percent in October, he said. The economic growth rate this year is expected to reach 5.46 percent, he said.