Third financial aid package and measures introduced in light of COVID-19

24 March 2020

Further to the Government measures announced on Wednesday 18 March, this evening the Prime Minister announced additional measures to support businesses and safeguard jobs.  These additional measures are estimated to amount to €70m per month.

All measures announced by the Government will apply retrospectively as from 9 March 2020. The amount of support being granted depends on the extent to which business in the respective sector has been hit. The main categories of business that are considered to have been more critically hit are set out below.  

Malta Enterprise have launched an online portal to help businesses identify, according to their applicable NACE code and VAT registration number, the measures for which they qualify. This portal, together with the relevant application form, may be accessed here.

Financial aid to critically hit business sectors

The following business sectors which have been identified as having been critically hit by the COVID-19 pandemic (covering 60,000 employees) will receive Government aid, in total amounting to around €44m per month.

  • Certain wholesale activities

  • Certain retail activities

  • Accommodation

  • Food and beverage service activities

  • Rental and leasing of motor vehicles 

  • Employment activities

  • Travel agencies, tour operators and related activities

  • Security and investigation activities

  • Service to buildings

  • Transport

  • Creative, arts and entertainment activities 

  • Personal services activities

For these sectors, the Government will finance up to €800 per month of each employee’s monthly salary.  This also applies to self-employed persons working in the said sectors. 

Where the monthly salary exceeds €800, the employer is expected to pay the remaining part up to a monthly salary of at least €1,200.  If an employer is not in a position to sustain the additional payment so that the particular salary reaches at least €1,200, then an agreement has to be reached with the involvement of the unions, the employees and the Department for Industrial And Employment Relations.

Financial aid to less critically hit sectors

The following are the sectors that are considered to have been less critically hit:

  • Manufacturing

  • Part of the wholesale sector

  • Part of the retail sector 

  • Warehousing

  • Information

In the case of such sectors, the Government will finance one day’s salary per week (based on a monthly salary of €800) per employee.  The Prime Minister also mentioned a possibility that this aid could be increased to two days. 

This measure covers approximately 50,000 employees and is expected to cost the Government around €17m per month.

 

Additional measures

Gozo

The Government recognised that business operations in Gozo may have been severely impacted by the COVID-19 pandemic. Accordingly, in addition to providing the measures outlined above, Government will be financing a further one day’s salary per employee (based on a monthly salary of €800) working in less critically hit sectors (this in addition to one day paid salary introduced for Maltese businesses operating in the same sectors).

Self-employed

The measures outlined above will also apply to self-employed persons working in the applicable sectors.

Self-employed persons working in less critically hit sectors and employing individuals should be eligible for additional assistance.

Part-timers

All the above measures will also apply to part-timers on a pro-rata basis (by reference to a deemed monthly salary of €500).

 

Payments

The Prime Minister also confirmed that all the announced employee-related payments would be made by the Government to employers and not directly to employees.

How can we help?

The details of these measures are still being communicated and further clarifications will need to be sought. We are continuing to follow developments and will provide updates as these become available. Join our webinar discussing the main tax incentives and measures introduced by Government on Friday 27 March at 1pm, by sending an email to mt.academy@pwc.com including your name, surname and email address.

In the meantime, please do not hesitate to contact one of our specialists for further information or should you wish to discuss the effect of these measures in your specific circumstances or in those of your business/enterprise.

Click on a Partners' name to send an email.

At the back, from left to right:
Steve GingellDavid FerryMirko Rapa and David Valenzia

In front, from right to left:
Neville GattBernard Attard and Mark Lautier 

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