Hainan launches 8 measures to support SMEs during COVID-19 epidemic

The Hainan Provincial People's Government launched eight measures on Feb 5 to support small-and medium-sized enterprises (SMEs) who encountered difficulties in resuming work and production during the novel coronavirus (COVID-19) epidemic period.

The measures mainly cover the four areas below:

Stabilizing work force

1. For those companies which do not lay off workers or which reduce their layoffs, a 50 percent refund of the total unemployment insurance premiums actually paid last year will be granted to them.  

2. For companies facing temporary production and operation difficulties that will not lay off employees or will reduce their layoffs, the refund will be a 6-month monthly unemployment insurance premium they paid last year for their employees.

Reducing operation costs

3. Reduce rent cost

The rent of the first quarter of 2020 will be reduced or exempted for SMEs that rent spaces from State-owned assets.

4. Mitigate operation pressure

Payment for electricity, water, and gas required for the production and operation of SMEs can be deferred for three months from the date of this notice.

5. Lower the housing provident fund payment rate

SMEs can pay the housing provident fund at 3 percent for six consecutive months

Reducing taxes

6. Cut taxes

Due to the impact of the epidemic, the property tax and urban land use tax payable by SMEs in the first quarter of 2020 will be reduced or exempted. 

For companies that produce and sell drugs and medical devices that help the prevention and control of the COVID epidemic, policy support will be provided in the process of implementing the value-added tax refund.

Relevant eligible pharmaceuticals, reagents, and vaccine R&D institutions will be offered timely and full-amount tax refunds for their purchase of domestic equipment.

7. Deferred payment of taxes

For SMEs that have difficulty in tax declaration due to the impact of the epidemic, deferred declaration will be granted according to law.

For SMEs that have special difficulties and cannot pay their taxes on time, deferred payment will be granted in accordance with the law.

Enhancing financial support to enterprises

8. Interest discount and financial guarantee

For new added loans by key enterprises engaged in epidemic prevention and control, an additional 50 percent and 30 percent interest discount by the central government and Hainan provincial government respectively will be offered on the basis of the interest rate of financial institutions that provide the preferential interest rate of the People's Bank of China's special reloans. 

The Hainan Provincial Department of Finance will give a discount of 30 percent of the basic loan interest rate on the day of signing the loan contract for key enterprises in Hainan that support epidemic prevention and control work in areas like making pharmaceuticals and medical equipment. The discount period for the above loans does not exceed one year.

State-owned financial guarantee institutions in Hainan should bridge SMEs and financial institutions, reduce unnecessary requirements, as well as cut guarantee fees.