WTTC COVID-19 Government Hub

Government COVID-19 Hub

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Significant and Swift Measures are needed to support the Travel & Tourism sector in the turbulent months ahead. WTTC urges governments to implement policies that will directly support the sector across the following three areas, namely: 
 

  1. Protecting the Livelihoods of Workers: Financial help must be granted to protect the incomes of the millions of workers in severe difficulty. 
  2. Fiscal Support: Government must extend vital, unlimited interest-free loans to global Travel & Tourism companies as well as the millions of small and medium-sized businesses as a stimulus to prevent them from collapse. Governments dues and financial demands on the Travel & Tourism sector need to be waived with immediate effect for at least the next 12 months.
  3. Injecting Liquidity & Cash: Cash flow assistance to support players big and small of the Travel & Tourism sector is critical as well as to offer targeted support to severely affected industries within the sector. 


On the basis on the three policy priority areas, above, WTTC has highlighted a number of countries which have announced and are now implementing impressive policies in this area:

Australia: In addition to the first $17.6 billion stimulus plan, the Government announced that a further AUS$66 billion ($38.3 billion) will be spent over the next six months. Within the plan, the Government pledged an AUS$1 billion (US$613 million) package to support business investment; provide cash flow assistance to support SMEs; offer targeted support for the most severely affected sectors, including Travel & Tourism; and make household stimulus payments that will benefit the wider economy.  The Government pledged $1 billion to support those sectors, regions, and communities that have been disproportionately affected by the economic impacts of COVID-19, including those heavily reliant on industries such as tourism, agriculture, and education.

Australia’s JobKeeper programme is helping to keep more Australians in jobs and supporting businesses affected by the significant economic impact of COVID-19. Under the wage subsidy scheme, workers receive a fortnightly payment of AUS$1,500 (before tax) through their employer. The Government also implemented cash injections and subsidies specifically for certain tourism businesses to stay afloat.

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


Canada: The Government passed a C$107 billion ($75 billion) package in emergency aid and economic stimulus. Through its measures, the Government is providing up to $27 billion in direct support to Canadian workers and businesses, plus $55 billion through tax deferrals to help meet cash needs and stabilize the economy. General support for individuals includes increasing the maximum annual Canada Child Benefit (CCB) payment amounts by $300 per child; postponing the individual tax filing date; and mortgage deferrals and loan re-amortisation, among others, for homeowners. Support for people facing unemployment includes a taxable benefit of C$2,000 a month through the Canada Emergency Response Benefit (CERB) and includes, among others, people quarantined and those helping a sick family member; up to $5 billion in support to workers not eligible for Employment Insurance (EI) benefits; and up to $900 bi-weekly, for up to 15 weeks for, among others, the self-employed, those who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits, and parents who require care or supervision due to school closures. 

Support for businesses includes amendments to the eligibility for the Work Sharing Program, which provides benefits to workers who agree to reduced normal working hours; a temporary wage subsidy equal to 10% of remuneration paid during that period for small employers; more than $10 billion of additional support, largely targeted to SMEs; tax deferrals; lowering the Domestic Stability Buffer to allow large banks to inject $300 billion of additional lending; a 75% wage subsidy for businesses; up to $40 billion in lending for SMEs;  stable funding to banks and mortgage lenders to continue lending; and providing up to $25 billion to eligible financial institutions to provide Government-guaranteed and funded interest-free loans to small businesses. 

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


Hong Kong, SAR: Following the $30 billion measures under the Anti-epidemic Fund and the $120 billion relief package in the 2020-21 budget, the Hong Kong SAR Government announced a new round of measures totalling $130 billion with a wide coverage, aiming to safeguard employment and the self-employed; provide extra relief to those sectors hard hit by the epidemic; and pave the way for post-epidemic economic recovery. These measures include an $81 billion Employment Support Scheme, as well as sector-specific initiatives totalling $21 billion.

For the Travel & Tourism sector, the Government plans to provide all licensed travel agents with cash subsidies ranging from HK$20,000 to HK$200,000; provide travel agents' staff and active freelance tourist guides and tour escorts holding a valid pass with a monthly subsidy of $5,000 each for six months; and provide licensed hotels with cash subsidies between HK$300,000 to HK$400,000. Other proposed relief measures for the industry include a one-off subsidy of HK$10,000 for each tourist coach driver, waiving the monthly rent and management fees of the operator of Kai Tak Cruise Terminal for six months, as well as providing subsidies to cruise lines in the form of refunds of berth deposits for cancelled ship calls during the suspension of immigration service.

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


China: The Party Central Committee and the State Council deployed three batches of tax and fee policies to support the epidemic control and the resumption of work. The first batch focused on epidemic prevention and control, focusing on direct support for medical treatment, and on supporting production/transportation of related support goods. The second batch focused on reducing the burdens of enterprises on social insurance premiums, pension, unemployment, work-related injury insurance contributions, medical insurance premiums, and reducing the cost of employment procedures. The third batch focused on small-scale enterprises, individually owned businesses and on small-scale VAT taxpayers, to supplement landlords who reduce or deduct rents. 

The Ministry of Culture and Tourism and the Industrial and Commercial Bank of China (ICBC) also signed a strategic cooperation agreement to help cultural & tourism enterprises. ICBC is providing RMB100 billion credit lines for affected cultural & tourism enterprises and making financing succession arrangements to meet capital needs through "anti-epidemic loan", "employment loan", and "tax loan", among others, so as to help privately-owned enterprises and small-medium-micro culture and tourism enterprises. The Civil Aviation Administration of China’s measures include tax relief and subsidies; VAT exemptions for revenues from transporting anti-epidemic materials and express delivery; waiving airlines' payment to the civil aviation development fund starting from 1 January; and more.

What’s more, local Governments came up with credit risk sharing policies to increase bank lending to SMEs and the People's Bank of China offered 500 billion yuan of relending and rediscount funding to help small banks provide low-cost funds to SMEs and the agricultural sector.

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


France: The French Government announced a plan of €45 billion to support the economy, of which around €35 billion are dedicated to the deferral of social and tax charges of companies. The self-employed were also considered in these measures. Within the €45 billion plan, €8.5 billion have been dedicated to the funding of short time working/partial unemployment measures. To use short time working, companies pay compensation equal to 70% of gross salary (around 84% of the net) to employees; employees with minimum wage or less are 100% compensated. The State will also fully reimburse partial unemployment for wages up to €6,927 gross monthly, i.e. 4.5 times the minimum wage. The Government is also implementing an exceptional guarantee scheme up to €300 billion to support the bank financing of companies to facilitate those banks granting loans to businesses of all sizes to preserve employment. In addition, French banks have committed to postponing the reimbursement of corporate loans for up to six months, free of charge. 

The Government announced specific emergency aid to support the creative industry. Based on recommendations from the Tourism Sector Committee – a committee created by the Government and comprised of Atout France and both public and private sector actors – a draft ordinance has been put together to support the cash flow of tourism operators in the face of cancellations. 

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


Iceland: The first phase of crisis response measures, equivalent to ISK 230 billion (€1.5 billion), aims to safeguard the economic livelihood of people and businesses, protect the welfare system, and create a strong demand in the economy. These measures include state-backed bridging loans for companies, guaranteeing 50% of the loans, with a maximum liability of ISK 35 million, and accelerating public project investments focusing on technical infrastructure and financial support for the tourism sector. The Central Bank of Iceland also lowered interest rates and plans further actions. The Government deferred tax payments, provided access to third-pillar pension savings (private pension savings), and offered VAT refunds for construction projects. 

Measures to protect workers include temporary payments to individuals who lost income from being quarantined, including paying the salaries of quarantined workers. The Minister of Social Affairs and Children submitted changes to Government whereby individuals who are downgraded to part-time employment could have certain rights to unemployment benefits. Self-employed individuals will be able to apply for temporary suspension of their business operations with the Icelandic Tax Authority and subsequently apply for unemployment benefits.

Travel & Tourism related policies together represent an ISK 4.6 billion injection into the sector. These include suspensions and deferrals on bed-night tax; domestic travel vouchers collectively worth ISK 1.5 billion for Icelandic residents over 18 years old to stimulate demand; allocation of an additional ISK 650 million for national park and protected area infrastructure; extensions and improvements at airports in East Iceland; acceleration of infrastructure investment for the electrification of harbours and rental car fleets; and a promotional campaign for domestic & international travel to be rolled out when the time is right.

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


New Zealand: The Government announced a $12.1 billion package to support New Zealanders and protect their jobs from the global impact of COVID-19. The package represents 4% of GDP and is more than the total of all three budgets’ new operating spending in this term of Government put together. The package includes $5.1 billion in wage subsidies for affected business in all sectors and regions as of 17 March; $126 million in COVID-19 leave and self-isolation support; $2.8 billion income support for the most vulnerable; and $2.8 billion in business tax changes to free up cash flow, including a provisional tax threshold lift. This cash injection is on top of the $12 billion New Zealand Upgrade Programme announced in January. The Government will open a NZ$900 million (US$580 million) loan facility to the national carrier as well as an additional NZ$600 million relief package for the aviation sector.

Key measures introduced include the reintroduction, from the 2020-21 income year, of a 2% DV depreciation deduction for commercial and industrial buildings, including hotels and motels; an emergency policy rate cut to 0.25%, for at least 12 months, by the reserve bank; and a Small Business Cashflow Loan scheme, offering up to $100,000 to firms employing 50 or fewer full-time equivalent employees. 

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


Portugal: The Government launched over 30 initiatives to protect workers and families and mitigate the economic impacts of COVID-19. It placed particular emphasis on the Travel & Tourism sector by establishing a dedicated €60 million credit line for micro-businesses in the sector and by working closely with Turismo de Portugal to bolster national capacity to respond to the challenges resulting from COVID-19. Business support measures include extraordinary support for the maintenance of employment contracts in a company in the amount of 2/3 of the remuneration, and ensuring 70% of Social Security, the remainder being borne by the employer; offering training scholarships in the Institute for Employment and Vocational Training in Portugal (IEFP); the extension of deadlines for the payment of taxes and other declarative obligations; exceptional financial support for employees and the self-employed who have to stay at home to accompany their children up to 12 years old; guaranteeing social protection for trainees and trainers in the course of training actions; and more.

The Government approved State-guaranteed credit lines including €200 million for travel agencies, recreational services enterprises, and event organisers, of which €75 million are for micro and small businesses; €900 million for hotels and accommodation establishments, of which €300 million are for micro and small businesses; rent relief; and more. Turismo de Portugal has created a €60 million support line for tourism micro-enterprises. 

For residents, all Turismo de Portugal’s Tourism Schools are now delivering online classes and the tuition fees were suspended during this period. Together with private sector associations Turismo de Portugal has made available a fund of €250,000 to support accommodation and hotel owners with electricity, water, gas, and cleaning costs. 

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


United Kingdom: The Chancellor set out a package of targeted measures currently amounting to £330 billion to support public services, people, and businesses. The measures include, but are not limited to, 12-month business rates holiday for all retail, hospitality, and leisure businesses in England; grant funding of £25,000 for retail, hospitality, and leisure businesses with property with a rateable value of more than £15,000 and less than £51,000; small business grant funding of £10,000 for all businesses in receipt of small business rate relief or rural rate relief; the Coronavirus Business Interruption Loan Schemes (CBILS) offering Government-guaranteed loans of up to £5 million for SMEs, up to £50 million of finance for larger businesses, and up to £5 million for others that cannot access the CIBLS; cash grants of up to 80% of their normal profits for self-employed individuals; and short-term debt options through the Bank of England for larger companies.

The Government also stepped in to pay wages with the Job Retention Scheme; a grant will cover 80% of wages up to £2,500 for those employees on furlough kept on payroll as well as national insurance and pension contributions. Tourism-specific support includes the Destination Management Resilience Scheme which repurposes £1.3 million of DEF funding to help support DMOs so they can lead the recovery of industry in their area. 

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


Singapore: The Government rolled out several policies and measures to support the Travel & Tourism sector with a focus on confidence building and providing aid. To build confidence, the Government is providing support for professional environmental cleaning and disinfection costs for hotels that provided accommodation for suspected/confirmed cases. Singapore created a Clean Certification to provide assurance to locals and visitors on tourism venues and facilities implementing rigorous preventive measures.

Among other measures to support the sector, Singapore also waived the licence fees for STB-licensed hotels, travel agents, and tourist guides for 2020; reduced by 50% the industry participation fees for STB-led tradeshows; enhanced the training scheme, and funding up to 90% of training course fees and trainer fees; provided salary support through Workforce Singapore of up to 70% of fixed monthly salaries, capped at $2,000 per month per employee for the training duration for up to six months; provided licenced self-employed tourist guides with wage support of $1,000 to assist with some of their basic living expenses, provided they are Singaporean citizens or permanent residents; implemented rebates on aircraft landing and parking charges as well as rental rebates for shops and cargo agents at Changi; and more. The Government is ready to consider further measures if and when necessary.

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.


Japan: Japan adopted its largest-ever emergency economic package worth ¥108 trillion, equivalent to about 20% of its GDP. The stimulus, with ¥39.5 trillion in direct fiscal spending, includes emergency measures worth ¥2.1 trillion already announced after the virus outbreak, and a set of programs worth ¥19.8 trillion, compiled in December, aimed at mitigating the economic impact of last year’s consumption tax hike. Of the total amount, ¥1.68 trillion has been earmarked to stimulate consumption and help tourism-related industries recover after the spread of the virus is finally contained.

The Development Bank of Japan (DBJ) will offer large businesses, e.g. airline companies, low interest rate loans with no upper limit. To address the financial needs of SMEs and offer several special lending schemes measures include, but are not limited to, ¥300 million (approx. US$2.8 million) loan for SMEs and ¥60 million (approx. US$561,000) for other smaller business operators; a loan facility of up to ¥10 million; loosening the eligibility requirements for the Safety Net Loan; and an additional Interest Subsidy Program for any SME that has utilised one or more of the applicable JFC lending schemes above and whose revenue has fallen by 20% or more.

For details on these and other COVID-19-related policies, please view the Strong Policies document at the top of the page.

 

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