The country has been locked out again and Prime Minister Tan Sri Muhyiddin Yassin yesterday announced the government’s latest economic stimulus package after MCO 3.0.
Called PEMERKASA +, it is worth 40 billion RM in total and includes a direct tax injection of 5 billion RM, with 3 main objectives:
- Increase the capacity of the public health system
- Continue the previous wellness programs under the Prihatin Rakyat agenda
- Helping businesses overcome tougher foreclosure
Here we’ll discuss the third objective of the program, which will help SMEs and businesses deliver essential and non-essential services to keep their businesses afloat.
1. Automatic moratorium for SMEs
SMEs that do not operate during MCO 3.0 are eligible for an automatic 3-month loan moratorium. This system is also extended to people in the B40 groups who have been affected by job cuts.
Businesses and individuals can choose to resume the moratorium or repay their loans at a reduced rate of 50% over 6 months. This will help around 5 million borrowers with a total value of RM 30 million.
2. Aid for travel and entertainment businesses
A 10% reduction on the electricity bill from July to September 2021 will be given to hoteliers, travel and tourism agencies, shopping and local complexes, convention centers, theme parks and airline offices local.
In addition, one-time assistance worth RM68 million will be provided to tour guides and tour bus drivers, who will each receive RM500.
3. Discounts on rental in commercial premises
A 30% reduction is granted on the rental of commercial premises from May to July 2021 for MARA entrepreneurs unable to operate their business during the MCO.
A special tax reduction is also granted to building owners who offer an additional 6-month rent reduction of at least 30% to SME tenants.
4. Special Prihatin grant for SMEs
The Prihatin Special Grant (GKP) for SMEs and Microenterprises has been increased to RM 1,500. Around 1 million eligible businesses will receive 1,000 RM in mid-June and an additional 500 RM in July.
5. Expanded Wage Subsidy Program
A one-month extension to the RM1.5 billion PERKESO wage subsidy program will be available for 2.5 million eligible employees and 200,000 employers. The initiative is capped at 500 employees per application.
6. Access to microcredit and loan facilities for SMEs
Small businesses, street vendors and micro-businesses will have access to RM1.5 billion in microcredit facilities. An interest rate of 3% will be provided by Bank Simpanan Nasional, TEKUN, MARA, SME Corp and Yayasan Pembangunan Ekonomi Islam Malaysia.
Bank Negara Malaysia (BNM) will also add RM 2 billion to its SME lending facilities with an interest rate of 3.5%, bringing the total amount available to RM 7 billion.
7. Exemption from compulsory levy
Employers registered with the Human Resources Development Fund (HRDF) will be exempt from paying the compulsory contribution in June 2021.
8. Sanctions appeals to the IRB and the SSM
The Inland Revenue Board (IRB) will review penalty appeals and deferral of tax payments until 2022 for affected taxpayers and businesses.
The Malaysian Enterprises Commission (SSM) will allow SOEs listed on Bursa Malaysia an extension to submit their financial statements and hold their annual general meetings at a later date.
SSM will also remove late fees to renew business licenses for SMEs, micro-enterprises, sole proprietorships and partnerships until December 31, 2021.
The government plans to improve existing law allowing for back-up measures to extend legal protections against breach of contractual obligations until December 31, 2021.
9. Plans for bus, taxi and e-mail services
The government has launched a rehabilitation program for the purchase of buses and taxis worth RM 1 billion, under which eligible bus and taxi operators can benefit from a 12-month moratorium and d ” an extended repayment period of 36 months.
Sales tax will be exempt on imported fully dismantled (CKD) and fully assembled (CBU) passenger vehicles until December 31, 2021. It has been extended from June 30, 2021.
- You can read the previous economic stimulus packages here.
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