Note: This is continuation from Part 1.
Dear fellow clients,
Greetings. Hope you are doing well.
In response to the previous Economic Stimulus Package (please refer to our previous email on Economic Stimulus Package 2020 (Prihatin Rakyat)), the Government has announced Additional PRIHATIN on 6 April 2020, which allocate RM 10 billion to reduce the burden of Small and Medium Enterprises (SMEs) during the pandemic. The additional PRIHATIN comprises of the following:
(1) Employer Related Measures
(2) Financial Assistance
(3) Waiver or Discount on Rent
(4) Companies Commission of Malaysia
(2) Financial Assistance
Special PRIHATIN Grant for Micro SMEs
A special PRIHATIN grant of RM 3,000 will be made available to each eligible Micro SME. The SME must register with the Inland Revenue Board to enjoy this assistance. The definition of Micro SMEs is not mentioned in the announcement. SME Corporation Malaysia defines a Micro Enterprise as a company engaged in manufacturing, services and other sectors, with annual sales turnover not exceeding RM 300,000 or with full time employees not exceeding 5 workers.
Moratorium on Instalment Payment
Government has also called on ending organisations listed below Money Lender Act 1951, who provide credit facilities to impose a moratorium on SME instalment payment for 6 months beginning April 2020, as provided by bank.
Abolishment of Interest rate under Micro Credit Scheme
The Government will abolish the 2% interest rate to 0% for loans given under Bank Simpanan Nasional’s Micro Credit Scheme amounting to RM 500 million. TEKUN Nasional will also be extending interest free loans to Micro SMEs with a maximum loan of RM 10,000 per borrower.
Note: Applicants can only choose either one of the above schemes to enable more businesses to enjoy this assistance.
To ensure that all PRIHATIN initiatives (including the additional ones) can be implemented quickly and smoothly, an inter-agency economic stimulus implementation and coordinating unit (LAKSANA) was set up by the Ministry of Finance (MoF). This unit will constantly monitor and report the progress of the implementation of all initiatives to the MoF and the prime minister himself. To support the delivery of PRIHATIN initiative, the https://imsme.com.my/portal/en/ portal operated by Credit Guarantee Corporation (CGC) with the support of Bank Negara Malaysia (BNM) is ready to accept SME loan applications. The portal also provides myKNP which is an advisory service about financing for SMEs.
If you need further clarification, please do not hesitate to contact our tax team.
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