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Give "first aid" to businesses facing the fourth wave of COVID-19

Give "first aid" to businesses facing the fourth wave of COVID-19

[VTV.vn] Nearly 60,000 businesses withdrew from the market in the first 5 months of this year, which increased more than 20% compared to the same period last year.
The fourth wave of the epidemic is complicated. Many provinces have to implement social distancing and isolation measures, once again leading businesses into a difficult situation. The fourth outbreak in our country has lasted for nearly 2 months. Besides some profitable sectors, most of the remaining  are once again in an alarming state. The issue of deploying support packages and businesses "first aid" policies have become heated again.
In fact, before the fourth wave of the epidemic began at the end of April, the Government and ministries also made a number of decisions to support businesses in the “new normal” situation. Typically, Decree 52 was issued by the Government on April 19 on continuing to extend the deadline for paying tax and land rent in 2021. The scale of tax payment extension was about 115,000 billion Vietnamese Dong. This was the third time the Government provided direct tax support for production and business. The implementation method  also changed in the direction of speeding up the support when taxpayers only needed to submit an application for an extension once for all tax periods.
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At the beginning of April, the State Bank also issued Circular 03 on restructuring the repayment term; exemption - reduction of interest and fees; keep the debt group for businesses affected by COVID-19
Many policies on supporting cost reduction for businesses such as electricity, water, etc. for production have also been implemented. However, the prolonged distance has caused the biggest difficulty for businesses in remaining revenue but still bearing the burden of costs. Last week, many new recommendations were made by ministries, sectors, provinces and the business community to "rescue" the health status of businesses.
Give "first aid" to businesses facing the impact of the fourth outbreak
Having to close 10 cinemas for more than a month after the fourth wave of the epidemic, a representative of BHD Star Cinema said that they  still had to pay a fixed cost of more than 20 billion VND to maintain despite the revenue being almost zero. He said that the policy of extending tax and land rent in 2021 only helped a minor part. What businesses expected to save cash flow was debt extension, reduced interest rates as well as reduced insurance costs. However, the enterprise is still unable to access…
Mr. Le Hoang Minh, Operation Director of BHD Star Cinema System, said: "Currently, businesses need more specific and practical support packages. In 2020, there are specific guidelines on social insurance payment extension. However, from 2021 up to now, there has been no specific guidance on this. That is difficult and we urgently need the Government to support."
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Tourism is always the hardest hit industry when the epidemic breaks out.
“Tourism is always the industry most affected when the epidemic breaks out” a representative of Vietravel Travel Company shared. Currently only 2% of employees are kept to operate in maintenance mode. The enterprise's leader said that besides the extension and postponement, the quick exemption and reduction of expenses such as land rent would be of great significance at this time.
Mr. Nguyen Quoc Ky, Chairman of the Board of Directors of Vietravel Tourism Company, said: "Many accommodation and travel businesses that rent land from the State should consider reducing land prices and house rents to reduce the burden. Before, during or after the epidemic, it is still the same. It is unbearable to pay rent on the right day because there is just no revenue. Therefore, I believe a mild decrease in this rent means a lot to businesses".
Ms. Nguyen Thi Bich Hanh, Deputy Director of Ho Chi Minh City Tax Department shared: "In 2020, the Government has decided to reduce 15% of land rent payable, for businesses which have to temporarily suspend 15 days or more due to the epidemic. Up to now, there has been no guidance from the Government. The Tax Department also advises the Committee to continue to recommend the Government to reduce this amount."
The supporting policies expected to propose to the Government by Ho Chi Minh City authorities include reducing the V.A.T. rate from 10% to 5% to decrease product costs and solve difficulties in terms of working capital requirements, supporting both production businesses and prices for people. City leaders also affirmed the view: what can be supported by the local authority should be done immediately.
Mr. Nguyen Thanh Phong, Chairman of the People's Committee of Ho Chi Minh City, said: "We have to be timely and fast with the spirit of supporting businesses being the priority. It makes no sense if we wait until the end of this fourth wave of epidemic."
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Some enterprises also propose mechanisms to support businesses, and not put too much pressure on the budget. For example, the V.A.T. tax that businesses have to pay can be used for them to loan again, in case they must continue their activities.
It is clear that the authorities of the provinces, cities, and especially the business community are looking forward to the next support policies, especially when the space for business support packages from the previous year is still available.
Require a new approach in implementing business support packages
According to the Ho Chi Minh City Business Association, the low rate of businesses accessing the old support packages is low partly because of the different requirements for different industry groups while each has its own unique characteristics. Therefore, the Association proposes that the important and key industry groups need individually designed support packages.
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Mr. Chu Tien Dung, Chairman of the Ho Chi Minh City Business Association, said: "The conditions for each sector will be more suitable and closer to the reality of each business field, the ability absorption will also be better".
Economic expert Nguyen Xuan Thanh said that to improve the effectiveness of the support package, it was necessary to focus on changing policies. In the context of digital transformation, agencies need to promote policies  such as supporting disadvantaged workers in the social security package.
Professor Su Dinh Thanh, UEH Principal proposed that “This is the time to look further, the State should focus on creating mechanisms so that the support money can really unlock the production and development capacity of businesses, not just literal financial support”
Professor Su Dinh Thanh commented: "Since our resources are limited, we must know how to invest resources in an impulse so that it creates a spillover and development for the economy, as long as having a right mechanism: transparent accountability, how the money is used, how it is distributed, who is the beneficiary.
Experts also believe that a part of businesses should also change their perception and promote the spirit of innovation to save themselves first during the recession due to the pandemic... before looking for any support package...
A few days ago, the Government directed the Ministry of Labour, Invalids and Social Affairs to urgently finalize the draft resolution to support workers and businesses affected by COVID-19. Policies to support businesses are still being researched and implemented. With the experience learned from the previous epidemic wave, the business community expects the next policy to hit it right, bringing effective support to the economy.
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