Chief Executive Carrie LAM, called a Press Conference last evening (8 April 2020).To support Kong Kong SMEs, a new series of measures involving over $130 billion to help businesses stay afloat, keep workers in employment, relieve financial burdens of individuals and businesses and assist the economy to recover once the epidemic is contained.
Along with the unprecedented measures include introducing an $80 billion Employment Support Scheme, $21 billion support for hard-hit sectors and relieve financial burdens of businesses and individuals.
Proposal on support Hong Kong SMEs with the following:
Implementing the Employment Support Scheme
The Government will provide wage subsidy to eligible employers to retain the latter’s employees. Hence, employers have to undertake that they cannot implement redundancy. The wage subsidy to be provided by the Government is calculated based on 50% of the monthly salary, which is capped at $18,000. In short, the Scheme is eligible for all employers have making MPF contribution. The disbursement to employers will separate in two payment. And expects to benefit 1.5 million employees.
Job Creation
In addition, Hong Kong Government is going to invest $6 billion to create around 30, 000 time-limited jobs (up to 12 months) in the public and private sectors. As a result, this measure aims at people with different skill sets and academic qualifications, benefitting not only professionals and technicians, as well as fresh graduates, middle level and grassroots workers.
Proposals on proving relief to hard-hit sectors
Due to the epidemic, admittedly, the government announced to suspense school, to ban entertainment sector and the industries with high risk. The acts hit the economy badly. Even so, the government proposed an additional of 16 types of support for businesses including tutorial school and the travel industry with the amount totalling $21 billion. Below industries are on the list:
- Tutorial school;
- Service providers and suppliers for schools
- Sport coaches
- Instructors of interest classes
- Up cycle refuse collector
- Exchange participants and Securities and Futures
- Commission (SFC) licensed individuals
- Licensed individuals of the estate agency sector
- Passenger transport sector
- Creative industries
- Tourism industry
- Construction sector
- NPOs under the Revitalising Historic Buildings Through Partnership Scheme
- Aviation sector
- Catering sector
- The sectors are completely or partly closed due to the measures for safeguarding public health imposed by the Government
Proposals on easing the overall cash flow and burden of businesses and individuals with the below:
Enhancing the SME Financing Guarantee Scheme
Government will introduce enhancements to the 80%, 90% and Special 100% Guarantee Products under the SME Financing Guarantee Scheme. Overall, the scheme estimated additional expenditure of around $12 billion, with this in mind, the additional guarantee commitment of $30 billion. Thus expected to benefit about 20,000-50,000 enterprises in Hong Kong.
Rental and Fee Concessions for Government Premises
Government will increase the rental or fee concessions from 50% to 75% in respect of eligible short-term tenancies and waivers administered by the Lands Department (LandsD) from April to September 2020. Consequently, bout 5,000 tenants/waiver holders will benefit. Short-term tenancies and waiver holders which are ordered to close or have chosen to close due to Government’s closure orders or other restrictions for safeguarding public health under Cap. 599F may apply for full concession. About 1300 tenants/ waiver holders/ hirers will benefit.
Beside the rental wavier programme, it extend the 75% waiver of water and sewage charges payable by non-domestic accounts for another four months from August to November 2020, subject to a monthly cap of $20,000 and $12,500 respectively per account. This waiver is an extension of the eight months’ waivers already offered. About 250 000 non-domestic accounts will benefit.
Total estimated revenue forgone arising from the above measures is around $1.3 billion. The Government will implement the measures above administratively or by way of subsidiary legislation as soon as possible.
For further information, please contact us.
You may want to read: http://centreo.hk/hong-kong-relief-measures-businesses-2020/