On the evening of March 18 2020, the Prime Minister of Malta, the Minister for Finance and Financial Services and the Minister for the Economy, Investment and Small Business announced a number of measures to support the Maltese economy in response to the COVID-19 outbreak. The collective value of this economic package is of circa €1.81 billion (an amount equal to 12.9% of Malta’s GDP in 2019). A summary of the most salient points follows.
1. Tax Deferrals
Deadlines in respect of payments due by employers and the self-employed persons in respect of income tax, VAT and social security and maternity fund contributions for the months of March and April will be postponed. This measure is expected to cost the Government between €400 million and €700 million.
2. Bank Guarantees
Government is willing to extend up to €900 million in bank guarantees. If fully utilised, these guarantees are expected to result in an additional access to credit of circa €4.5 billion. These bank guarantees may be utilised to support the provision of soft loans or temporary moratoriums on personal and business loans.
3. Capital Injection
The Minister for the Economy announced a direct injection of circa €210 (1.5% GDP) million in the Maltese economy. Around €35 million will be allocated to the Health Authorities to fight COVID 19.
4. Financial Aid, Quarantine Leave
Wages paid to employees under mandatory quarantine leave will be partially paid by Government. A sum of €350 will be granted to employers for each employee under quarantine leave.
5. Family Friendly Measures
It is estimated that there are circa 12,000 families with children who have both parents/guardians working in the private sector. If both parent/guardian are unable to telework, Government will offer a benefit of €800 per month to the family, which benefit is intended to cover 2 months of additional leave for one of the parents/guardians.
6. Further Efforts to Assist Businesses
In a bid to safeguard employment and alleviate financial pressures off of enterprises, Government intends to:
- Cover 2 days of employee wages per week (based on a maximum wage of €800 per month) for enterprises suffering from a complete suspension of operations (including providers of accommodation, food and beverage services, language schools and entertainment venues). This is expected to benefit between 20,000 – 44,000 employees;
- Cover 2 days of income per week (based on maximum income of €800 per month) for the self-employed suffering a complete suspension of operations (including providers of accommodation, food and beverage services, language schools and entertainment venues). This is expected to benefit circa 5,700 self-employed persons. Government coverage will increase to 3 days in the case of self-employed individuals who employ others;
- Cover 1 day of employee wages per week (based on a maximum wage of €800 per month) for enterprises whose operations decreased at least by 25%. This is expected to benefit circa 47,500 employees;
- Cover 1 day of income per week (based on maximum income of €800 per month) for the self-employed whose operations decreased by at least 25%. This is expected to benefit circa 9,600 self-employed persons. Government coverage will increase to 2 days in the case of self-employed individuals who employ others;
7. Increase in Unemployment Benefit
Individuals whose full-time job has been/may be terminated with effect from 9 March 2020 shall benefit from a temporary increase in their unemployment benefit of up to €800 per month.
8. Persons with Disabilities
Persons with disabilities who are unable to work from home and must stay at home will be entitled to a special temporary benefit of €800 per month.
9. Housing Subsidies
Government housing subsidies shall be granted to families where one dependent has his/her employment terminated. Those who previously benefitted from government housing subsidies will be eligible for an increased subsidy should one dependent have his/her employment terminated.
10. Third Country Nationals
Enterprises dismissing an employee will not be allowed to offer the dismissed employee’s job to a Third Country National. Malta shall no longer accept work permit applications for new third-country nationals (an exception will be made for highly skilled workers). The Government shall seek to assist all third-country nationals who are presently in Malta and have their employment terminated to find an alternative employment.
Jobsplus has launched a new service to assist residents (Maltese and EU nationals) whose employment has been terminated, third-country nationals whose employment has been terminated as well as to assist work permit queries, and employers seeking new recruits.