Updated: €2.5 million allocated to the new Industrial Rent Subsidy 2020 – Silvio Schembri

€2.5 million are being allocated to the newly launched Industrial Rent Subsidy 2020 scheme, aimed at helping small and medium enterprises (SMEs) and self-employed businesses that need to rent industrial space to carry out their work, Economy Minister Silvio Schembri said today.

Addressing the media, Schembri said that this scheme is not tied to Covid-19 in any way as its aim is to ensure that businesses can better their investment and increase their workforce.

This is being done by supporting businesses’ renting costs for industrial spaces. The government will be giving a supplement that amounts to a maximum of 50% of the cost, excluding taxes.

The scheme is applicable for 3 years – from the 1 February 2020 to 31 December 2022 – and €2.5 million have been allocated to it from the budget. However, Schembri said that this may change depending on the demand and how the economic situation is at the time.

The minister explained that the maximum support that an applicant can get is €25,000, meaning that the maximum they can have over three years is €75,000.

“This is a scheme that is not aimed for large scale businesses but rather for small and medium sized companies and cooperatives, as well as registered self-employed businesses,” he said.

Companies must be employing 100 persons or less on a full time contract with an annual turnover that does not exceed €10 million in the previous two years.

Businesses eligible for this scheme include those that provide repair or maintenance services for machinery, equipment or motor vehicles as well as manufacturing businesses and other industrial activities.

There are also some exclusions when it comes to applications, such as in the case of a property that is owned by persons related to the applicant, is the space is public property and also showrooms, display areas or other properties of the like.

Malta Enterprise CEO Kurt Farrugia said that applications can be found on the Malta Enterprise website for anyone who fits the requirements.

These requirements include providing justification for needing a supplement, describing the employment and the premises and providing both a turnover and balance sheet details and a De Minimis Declaration form.

Farrugia said that the evaluation process includes an inspection of the businesses’ work and premises by the Malta Enterprise in order to ensure that the scheme is not abused.

Reaction

The Malta Chamber welcomed the Government taking on board its proposal to create a scheme to subsidise commercial rent for small businesses. This was a proposal made by the Malta Chamber in its continuous feedback to Government on the needs of businesses at this challenging time.

The Malta Chamber however notes that the budget of Eur2.5m dedicated to the initiative is too low to cater for the expected demand it will attract. It is noteworthy that rent is generally the second greatest expense for any business following salaries. Therefore, it is crucial that Government implements this scheme correctly with adequate budget right from the start. ‘Though the initiative is laudable, the budget is lamentably too low to make a real difference’ the President of The Malta Chamber Perit David Xuereb said.

‘This scheme is open to the absolute majority of businesses in Malta, businesses employing less than a 100 people, and the amount of Eur2.5m which is dedicated to this initiative, will barely scratch the surface or make a difference’. The Malta Chamber calls on Government to dedicate more funds for this laudable scheme, as it is expected to be quickly oversubscribed. At the same time, Government is encouraged to ensure that the fund is used judiciously to support companies that were viable and tax compliant before the Covid situation. The Malta Chamber remains available to assist Government with researched and expert opinions

Source: Independent Malta Updated: €2.5 million allocated to the new Industrial Rent Subsidy 2020 – Silvio Schembri
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