COVID-19 | Malta Financial Aid Package

March 19, 2020 | 4 minute read

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18th March 2020

On the 18th March 2020, the Prime Minister of Malta, Dr Robert Abela, together with the Minister for Finance and Financial Services Prof. Edward Scicluna and Mr Silvio Schembri, Minister for Economy, Investment and Small Businesses announced further measures aimed at assisting companies and self-employed business to combat the adverse effects of the Covid-19 pandemic.

 

The Maltese Economy

 For 2020, the prediction for Malta's economic growth was of 4.3%.

The Minister acknowledges that the economy will be negatively impacted both from the demand and supply perspective but also acknowledges the fact that this is something temporary.

The government is allocating €1.81 billion which is equivalent to 12.9% of Malta’s Gross Domestic Product in 2019 as a financial aid package to those businesses that need assistance during these difficult times shaped by the Covid-19 pandemic.
 

The Economic Measures

  1. The tax deferral scheme already announced earlier is estimated to result in deferred tax payments ranging between €400 - €700 million;

  2. When it comes to liquidity injection and guarantees, the allocated funds are of €1.6 billion, which when removing the tax deferral estimates, the government is committing €900 million for additional access to credit;

  3. Through the national development and social fund, a total of €150 million shall be allocated as bank guarantees. The total value accessible for local businesses in the form of soft loans shall be of €750 million. Furthermore, local banks can accept up to 3 months of a moratorium for personal and business loans; and

  4. An additional €35 million has been allocated for health authorities to fight Covid-19. Such a measure should finance the acquisition of additional equipment and other supplies that will be required to combat COVID-19. There is no capping for such a measure.

 

Employment-Related Measures

  1. Quarantine leave – Employers who have or had a member of their staff (including themselves) on mandatory quarantine leave in accordance with the directives of the Superintendent of Public Health are entitled to a one-off lump sum grant of €350. The grant is also applicable for members of staff who had to quarantine themselves in view of possible contact with individuals who were directly at risk of infection, such as living in the same dwelling or in the same workplace. This measure only covers grants for full-time employees;

  2. Parents who both work in the private sector requiring one of the parents to stay at home to take care of school-aged children will receive a direct payment of €166.15 per week if working full time or €103.85 per week if working part-time provided that they cannot carry out their functions through teleworking arrangements. Such amounts are based on the €800 (full-time) and €500 (part-time) less social security contribution payments. This measure also applies for single parent families who have school-aged children;

  3. Employees who had their full-time employment terminated as of 9th March 2020 as a result of the COVID-19 pandemic will be eligible for the Contributory Unemployment Benefit and will receive a direct payment of €166.15 if work was in full-time before you became unemployed or €103.85 per week if work was part-time before becoming unemployed;

  4. Persons with Disability who work in the private sector and are duly registered with Jobsplus, may opt to stay home for health and safety reasons will receive a direct payment of €166.15 per week if working full time or €103.85 per week if working part-time. Same applies here – these amounts are based on the €800 (full-time) and €500 (part-time) less social security contribution payments;

  5. Government housing subsidies shall increase for those families where one dependent had his/her employment terminated.

Business-Related Measures

  1. For those enterprises that suffered from a complete suspension of their operations such as accommodation, food and beverages, language schools and entertainment amongst other, estimating to affect between 20,000 to 44,000 workers, the government will be covering 2 days salary per week based on a monthly salary of €800 per month. This measure also applies to self-employed individuals;

  2. For those self-employed individuals who employ people, the government will also be covering 3 days salary per week based on a monthly salary of €800 per month; and

  3. Those enterprises who suffered from at least a 25% reduction in their operations will benefit from a grant of 1 day's salary per week based on a monthly salary of €800 per month. This also applies to self-employed individuals.

 

Employment Measures Applicable to Third-Country Nationals

  1. All enterprises who terminate an active employment contract shall be denied the possibility of applying for third-country national workers;

  2. No applications shall be accepted for new third-country nationals except for highly skilled workers; and

  3. Assistance shall be provided to find alternative employment for those third-country nationals whose employment was terminated.


New Initiative Launched by JOBS PLUS to Assist

  1. Those residents whose employment has been terminated;

  2. Third-country nationals whose employment has been terminated as well as to assist work permit queries; and

  3. Employers seeking recruits.

 

How can we assist?

We are keeping ourselves up to date with the measures as being announced. The above measures are still being communicated, and we expect further clarification on the applicability. We shall keep you informed through our website portal of such clarifications, as well as on the methodology of applying to certain measures.
 
Get in touch with us through email on tax@nexiabt.com to clarify any aspect of these measures, or the other measures and incentives announced earlier.
 
We are working remotely but always available to assist you!
 

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