The country has closed again and Prime Minister Tan Sri Muhyiddin Yassin announced yesterday the government’s latest economic stimulus package after the MCO 3.0.
Called PEMERKASA +, it has a total value of 40 billion euros and includes a direct tax injection of 5 billion euros, with three main objectives:
- Increase the capacity of the public health system
- Continue the previous social security programs under Worried people agenda
- Help companies withstand the tightest lockout
Here, we will cover the third objective of the scheme, which will help SMEs and essential and non-essential service companies to keep the business afloat.
1. Automatic moratorium for SMEs
SMEs that do not operate during MCO 3.0 can opt for a 3-month automatic loan moratorium. This scheme also extends to people in B40 groups affected by job loss.
Companies and individuals can choose to recover the moratorium or repay their loans at a reduced rate of 50% in 6 months. This will help approximately 5 million borrowers with a total value of RM 30 million.
2. Aid for travel and entertainment companies
A 10% discount on the electricity bill from July to September 2021 will be granted to hotel operators, travel and tourism agencies, complexes and commercial premises, convention centers, theme parks and local airline offices.
In addition, one-off assistance valued at RMS 68 million will be provided to tour guides and tour bus drivers, who will receive RMS 500 each.
3. Rental discounts on commercial premises
A 30% discount is given on the rental of commercial premises from May to July 2021 for MARA entrepreneurs who are unable to operate their businesses during the MCO.
A special tax reduction is also offered to building owners who offer a 6-month rental discount of at least 30% to SME tenants.
4. Special subsidy Prihatin for SMEs
The special subsidy Prihatin (GKP) for SMEs and micro-enterprises has amounted to 1,500 RM. Approximately one million eligible companies will receive RM 1,000,000 in mid-June and another RM 500 in July.
5. Extended wage subsidy program
A one-month extension will be available for the PERKESO wage subsidy program worth RMS 1.5 billion for 2.5 million eligible employees and 200,000 employers. The initiative has a maximum limit of 500 employees per application.
6. Access to microcredit and loan facilities for SMEs
Small businesses, street vendors and micro-enterprises will have access to RM 1.5 billion in microcredit facilities. Simpanan National Bank, TEKUN, MARA, SME Corp and Yayasan Pembangunan Ekonomi Islam Malaysia will provide an interest rate of 3%.
Bank Negara Malaysia (BNM) will also add RMB 2 billion to its SME loan facility with an interest rate of 3.5%, bringing the total amount available to RMB 7 billion .
7. Exemption from the mandatory fee
Employers enrolled in the Human Resource Development Fund (HRDF) will be exempt from paying the mandatory fee in June 2021.
8. Sanction appeals to the IRB and SSM
The Board of Finance (IRB) will study the sanction appeals and the deferral of tax payments until 2022 for affected taxpayers and businesses.
The Malaysian Business Commission (SSM) will allow public companies listed on the Malaysian Stock Exchange to extend their financial statements and hold their annual general meetings later.
SSM will also waive late fees to renew business licenses for SMEs, micro-enterprises, sole proprietorships and partnerships until December 31, 2021.
The government plans to improve existing legislation to allow relief measures to extend legal protections against breach of contractual obligations until December 31, 2021.
9. Schemes of bus, taxi, electronic telegram services
The government launched a rehabilitation program for the purchase of bus and taxi rentals worth RMS 1 billion, where eligible bus and taxi operators could obtain a 12-month moratorium and an extended return period of 36 months.
The sales tax will be exempt from fully demolished (CKD) and fully accumulated (CBU) imported passenger vehicles until 31 December 2021. It has been extended from 30 June 2021.
- You can read about previous economic stimulus packages here.