Corona-Pandemic: Immediate Taxation, Legal Measures and Financial Aid in China, Singapore, Taiwan, Australia and India
So far the Chinese economy has been hit hardest by the Corona crisis. The neighbouring economies are also struggling. Our Ecovis partners in India report that it is a criminal offence in India to circulate “fake news” via social media. Here’s what our partners in China, Singapore, Taiwan, Australia and India have summarised on new temporary legal measures, postponements of taxation due dates and financial aid for businesses and individuals.
The central government has announced a series of measures reducing taxation for enterprises and individuals, as well as reducing health and social insurance contributions. During the COVID-19 pandemic, different tax reduction measures apply for specific industries and material providers. To prevent the outbreak spreading further, online tools are available for tax declarations to reduce direct contact. To stimulate the economy, the government has imposed new export tax rates, increasing to 13% on 1084 export items.
State governments have also announced postponements of monthly tax filing and corporate income declaration. In the Greater Shanghai area, three major social insurance payments (pension fund / unemployment fund / labour injury fund) are reduced by 50% for larger enterprises from February to April 2020, with a 100% waiver for SMEs. Social security payment for 2019 is postponed to 1 July 2020.
Ecovis China is monitoring all new measures of taxation and insurance policies. We will continue to update clients with the new information in order to obtain government support and avoid further losses.
The government has banned foreigners coming into or transiting through Singapore who have been to China, South Korea, Japan, Italy, France, Spain, Germany and Iran in the past 14 days. The government has also imposed a 14-day self-quarantine notice on everyone entering Singapore from other countries, including Singaporean citizens.
Several financial support packages have been approved by the authorities. However, up to now there are no postponements of taxation due dates. Ecovis Singapore has prepared detailed information to help clients apply for various support packages.
The Taiwanese tax authority has announced the following policies during the pandemic period:
- If the responsible person or the tax agent has been quarantined or infected with COVID-19, the tax return can be postponed for up to 1 month.
- If the taxpayer or their business is affected by the COVID-19 epidemic, the taxpayer may apply to delay tax payment for up to 1 year or to pay in up to 36 instalments
Ecovis Taiwan has started to implement its business continuity plan to ensure our ability to continuously provide professional services at this difficult time. We will be able to assist clients in applying for any exemption or preferential tax treatment related to COVID-19.
The Australian Government has released a stimulus package for businesses.
The government plans include the following:
- Increasing the instant asset write off threshold from AUD 30,000 to AUD 150,000 and expanding access to include businesses with aggregated annual turnover of less than AUD 500 million (up from AUD 50 million). This applies from 12 March 2020 until 30 June 2020 for new or second-hand assets first used or installed ready for use in this timeframe.
- Introducing accelerated depreciation deductions for businesses with turnover less than AUD 500 million. A deduction of 50% of the cost of an eligible asset on installation will apply, with existing depreciation rules applying to the balance of the assets’ cost.
- Boosting cash flow for employers with:
- The option of deferring payments by up to four months for activity statements, income tax assessments and fringe benefits tax. Employers will need to continue to meet their ongoing super guarantee obligations for their employees.
- Allowing businesses on a quarterly activity statement cycle to opt into monthly GST reporting in order to get quicker access to GST refunds they may be entitled to.
- Allowing businesses to vary PAYG tax instalment amounts to zero for the March 2020 quarter.
- Remitting any interest and penalties incurred on or after 23 January 2020 that have been applied to tax liabilities.
- Enabling businesses to pay their existing and ongoing liabilities by allowing them to enter into low interest payment plans.
- Payroll tax for businesses with payrolls of up to AUD 10 million has been waived for April, May and June 2020
Ecovis Australia can provide detailed information and assist clients in applying for tax return and financial aid packages under these new measures during the pandemic difficulties.
There are various legal measures, including making it a criminal offense to circulate wrong or inauthentic messages via electronic media. There are also visa restrictions and entry bans at airports. In some areas and states in India, section 144 of the criminal procedure code has been enforced, prohibiting any public meeting or assembly of 5 or more persons or procession with any number of persons. There are many other legal measures which can be implemented if necessary.
Due dates for tax filing are currently not postponed. However, there is an ongoing scheme of amnesty for disputed tax which may be extended beyond 31 March 2020. Companies have already been allowed to hold board meetings by means of video conference until June 2020.
There will a self-regulated curfew throughout India from Sunday, 22 March 2020 between 7 am and 9 pm (IST). All Indians have also been asked to clap or beat a drum from their windows or balconies at 5 pm on the same day to show respect for doctors, hospitals and all others serving the cause.
Ecovis India continues to render professional services during the pandemic and to provide all clients with the appropriate information concerning timely taxation and legal measures.