HK$137.5 billion Financial Relief Package offered for Hong Kong SMEs

Government announced a HK$137.5 billion (US$18 billion) financial relief package on 8^th April, in addition to save ailing businesses and their workers. The package is divided into 4 parts:

Job retention;
Job creation;
Sector-specific aids;
Rental concessions, fee waivers, loans

1. Financial Relief on Job retention (HK$80 billion)

Employment Support Scheme

First and foremost, Government to pay 1.5 million workers 50% of their wages, capped at HK$9,000 a month for 6 months.
The money will be distributed through employers. Above all recipients must have a Mandatory Provident Fund (MPF) pension scheme account in order to qualify.
Secondly, businesses can expect to apply for financial help no later by June for the first payment.
Thirdly, self-employed people will get a one-off subsidy of HK$7,500

2. Financial Relief on Job creation

With this in mind of unemployment rate increase in the past 3 months, the Hong Kong Government to create 30,000 job in the coming 2 years. The expenditure is HK$6 billion. To employ 10,000 civil servants and 5,000 internships.
Hence, a HK$800 million scheme to let workers learn new skills or let businesses apply more technology. For example, Visual Aid facilities in Lew Firm.

3. Sector-specific aids (HK$21 billion)

Education

One-off grants to:

Tutorial schools: HK$40,000.
Tuck shops, canteens and lunchbox providers in schools: HK$10,000-HK$80,000.
School bus drivers and bus nannies: HK$10,000
Sport coaches, instructors and operators of interest classes: HK$7,500.

Construction, finance, cleaning and farming

Construction workers: HK$7,500.
Contractors and companies: HK$20,000.
HK stock exchange participants: HK$50,000.
Security and Futures Commission’s licensed individual: HK$20,000
Refuse collectors: HK$8,000.
Farmers and fishermen: HK$10,000

Transport and aviation

Taxi drivers and red minibus drivers to received a monthly subsidy of HK$6,000 for 6 months.
Tax and red minibus owners: HK$30,000.
Airport Authority to buy 500,000 air tickers for HK$2 billion.
Local airlines to receive HK$200,000 to HK$1 million for each aircraft.
40 aviation support services operators: HK$1 million to HK$3 million.

Tourism

Travel Agents: HK$20,000 to HK$200,000; each staff: HK$5,000 for 6 months.
Hotels: HK$300,000 to HK$400,000.
Coach drivers: HK$10,000

Creative industries

Cinemas to get HK$100,000 per screen, with a cap of HK$3 million for each company.
Coming Hong Kong Book Fair participants to get HK$100,000.
12 selected NGOs operating businesses in public heritage building to get HK$3 million.

Catering

In most cases, catering outlets to get HK$250,000 to HK$2.2 million, as a result, no less than 80% to be used to cover workers’ wages. However, catering outlets cannot apply for Employment Support Scheme in the same time.
As a rule, outlets also get HK$50,000 for close-down order.

Subsidies for establishments order to close

Also, amusement game centres, bathhouses, gyms, bowling alleys, skating rinks, mahjong parlours, clubhouse operators to receive HK$100,000 each.
HK$30,000 to HK$100,000 for beauty salons and massage parlours, capped at HK$3 million for each chain.

4. Rental concessions, fee waivers, loans

MTR cut fares by 20% for 6 months from 1 July 2020
To temporarily relax the monthly public transport expense threshold of the Public Transport Fare Subsidy Scheme from $400 to $200 for a time-limited period of 6 months from 1 July 2020
The Education Bureau (EDB) will invite all borrowing institutions and the international schools to accept the two-year loan repayment holiday.
Student Financial Assistance Agency (WFSFAA) will issue notification letters to student loan repayers concerned to inform them of the two-year loan repayment holiday.
Additional extension of 3 months on deadline for payment of tax for year of assessment 2018/19.
Nevertheless, to raise maximum loan amount under SME Financing Guarantee.
Along with rental allowance increase for tenants of government premises from 50% to 75% for 6 months.
Waive registration fees for 125,000 health care professionals for 3 years.
Further extend the 75% waiver of water and sewage charges payable by non-domestic accounts for till November 2020,

5. Other Initiatives

All together, Monetary Authority to adjust regulations release a total lending capacity of HK$1 trillion for banks. On the whole, Insurance Authority to facilitate major insurance companies in offering a grace period for premium payments for clients. Apart from this, the Government departments will extend the deadline for project completion in accordance with contract mechanism and/or relax the payment schedules of Government works and non-works contracts. Last but not least, to extend the Building Covenant (BC) period for development projects by up to six months in land leases

For further information, please contact us.

You may want to read: http://centreo.hk/government-measures-support-smes/