An additional number of wide-ranging measures have been launched by Malta Enterprise to assist businesses in countering the economic impact of COVID-19.  Other social and economic measures will be launched according to the circumstances and needs arising in the coming weeks.

The measures which are currently available, include the following:

1. Business Development and Continuity Scheme

The Business Development & Continuity Scheme is intended to facilitate projects that are expected to contribute to the regional development of Malta and to support existing undertakings sustain operations during restructuring. 

The activities which may be supported under the scheme are various, and include:

  • the initial development phase of undertakings establishing an operational base in Malta;
  • expansion projects;
  • consolidation of activities; and
  • the reorganisation of activities.

Although the available support will be granted primarily in the form of tax credits, nevertheless, the Corporation may approve for support to be provided in full or partially as a cash grant.  Such support is geared towards expediting the development of new business whilst ensuring continuity of current operations.

2. Skills Development Scheme

The Skills Development Scheme will provide the requisite support to businesses, enabling them to provide non-legally mandatory training which will develop and update the skills and knowledge of their workforce. The training is envisaged to flourish the skillset employees, address skills shortages, facilitate re-skilling, tackle skill mismatches and work towards developing a knowledge-based workforce.

Once again, the support under this scheme will be granted in the form of a tax credit, however this does not exclude the possibility of support being provided in the form of a cash grant.

3. Business Advisory Services

This scheme is targeted at facilitating entrepreneurs', managers' and business owners' access to advisory services which will in turn allow for the formulation of business strategies which will ensure business sustainability and growth.

To this effect, beneficiaries under this scheme will avail of a Business Advisory Voucher (valid for 6 months), which voucher can be utilised to pay for services to be rendered by advisors or consultants such as advice given on specific business difficulties or development initiatives within the business endeavour. The voucher has a monetary value of up to €500 with a minimum of 5 hours of advisory services.

4. Family Business Support Services

Family Businesses are at the heart of the measures introduced under this scheme, and beneficiaries must be registered as such in order to be eligible for the support provided.  The aim is to support the development of Family Businesses in building internal capacities and supporting them in the transfer of their business activity.

The support provides access to advisory services during business transition and access to specific training deemed beneficial in facilitating the growth of Family Businesses.

5.  Assistance on Mergers and Divisions (managed by Commissioner for Revenue)

The stark reality businesses may need to face in order to survive in a post-COVID-19 business environment, is one which might necessitate the need to consolidate, reorganise or in some cases even merge with other entities.

Where business reorganisations are carried out for bona fide reasons, the said businesses will be able to benefit from the assistance being granted by the Commissioner for Revenue.  In this respect, the business can proceed by submitting a ruling to the Office of the Commissioner of Revenue, which ruling must be drafted in accordance with the Rulings (Income Tax and Duty Treatment of Mergers and Divisions) Rules S.L. 123.140. 

In terms of the ruling approved by the Commissioner for Revenue, the provisions under the respective legislation imposing capital gains taxes and stamp duty would be rendered inapplicable to the transaction undertaken.  Consequently, no capital gains tax or stamp duty would be payable within context of the bona fide reorganisation undertaken.

More details on these measures can be accessed from the website of the Malta Enterprise through the following link: https://covid19.maltaenterprise.com/

Article orignally published on 24 April 2020

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.