The Government is implementing and considering further fiscal action to cushion the economic impact of COVID-19. These include:
- Waived the Special Consumption Tax on approximately 100,000 liters of alcohol for use in making (or substituting for) sanitizers that will be donated to the National Health Fund and Ministry of Health. This will ensure that sanitizers remain available in Jamaica.
- Waived Customs Duty on the importation of masks, gloves, hand sanitizers and liquid hand soap for a 90 day period.
- Under normal circumstances, Customs requires BPO firms to keep the equipment used in their operations physically at their place of business. They will waive this requirement for a specific period to facilitate working from home and for business continuity.
- In discussions with commercial banks for them to provide temporary cash-flow support to businesses and consumers in affected sectors through deferral of principal payments, new lines of credit and other measures.
Covid Allocation of Resources for Employees (CARE) program
- The CARE program is applicable to small businesses in Jamaica, who operate in many sectors, who provide vital goods and services and who employ other Jamaicans such as waiters, waitresses, bartenders, gardeners, room attendants, drivers, caregivers, security guards, office attendants and clerks among other categories of workers who are the backbone of our hotel, attraction, tour, restaurant industry.
The Business Employee Support and Transfer of Cash (BEST Cash):
- This will provide temporary cash transfers to registered businesses operating in the hotel, tours, attraction companies, segments of the tourism industry who are licensed with the Jamaica Tourist Board based on the number of workers they keep employed who are under the income tax threshold of $1.5 million. When such businesses file and pay their payroll returns as usual on the 15th of April, May and June, for each employee, with taxable income that is less than 1.5 on whose behalf statutory returns are applied, the Government will transfer funds at a rate of $9,000 per fortnight to that tourism related business, by direct transfer to their bank account, paid monthly. For the months of April, May and June that will equate to $54,000 for each employee they retain whose taxable income is less than $1.5 million
- Supporting Employees with Transfer of Cash (SET Cash):This will provide temporary cash transfers to individuals where it can be verified that they lost their employment since March 10, (the date of the first Covid case in Jamaica). This program will be available to employees from any sector who lost their employment after March 10 and before June 30. The SET Cash program is directed towards individuals who earn below the income tax threshold of $1.5m who constitute 80 and whole are most vulnerable to the effects of being suddenly laid off.
- It is expected that the BEST Cash and SET Cash elements of the CARE program will cost approximately $5.9 billion.
Covid Grants to those who are marginally self-employed and informally employed
- The Government will allocate $1 billion in additional funding to the Ministry of Labour and Social Security to provide Covid Grants to those who are marginally self-employed and informally employed.
Covid PATH Grants
- The poor and vulnerable on PATH will be affected by this crisis in ways that may not be readily visible. They are characterised by having income that is supplemented by various irregular flow, which are likely to be interrupted by the COVID pandemic. As a result, the Jamaican Government will be channeling $1.1 billion of additional funding to the Ministry of Labour and Social Security to be used to increase PATH Cash Grants paid during the period of April-June.
Covid Small Business Grant
- The MSME sector plays a very vital importance to Jamaica. Over the past few years we have seen a growth in the number of micro and small enterprises operating in Jamaica and they account for a substantial amount of employment. All small businesses with sales of $50 million or less who files taxes in the 2019/2020 financial year, and who filed payroll returns indicating they have employees, will be eligible for one-time COVID Small Business grant of $100,000.
Covid Tourism Grant
- Jamaica’s tourism industry consist of many small hotel operators, attraction companies, tour operators, transportation companies, entertainment companies among others. The Government will make $1.2 billion available in the form of grants to businesses operating in the tourism and related sectors.
Covid Compassionate Grants
- The poor and vulnerable are not limited to the PATH beneficiary population. They include the elderly not on PATH, the infirm, the homeless and people on the streets. The Government will allocate $150 million to the Ministry of Local Government to supplement the Poor Relief programme, and their budget in general, to respond as required with food, medicine and supplies that this population will require.
Covid Student’s Loan Bureau
- Jamaica will be deferring principal and interest payments on student loans for the three-month period April – June to cushion the impact on young graduates while giving new graduates 14 months to start payment their student loans after graduation. The Constituency Development Fund will also be increased by $3 million to address Covid Compassionate Grants and Care packages for the vulnerable on a constituency basis. This will cost approximately $200 million.
Covid assistance for small Farmers
- The Ministry of Industry, Commerce, Agriculture and Fisheries will be reallocating expenditure in the budget to provide $200 million relief for small fallers either through funding NGO’s to purchase farm output from those who supply hotels and give to the needy or other means.
Stimulus Measures to the Housing Sector and Benefits to NHT Contributors
The Government through the NHT put in place special relief for mortgagors who may lose their jobs as a result of COVID-19. Effective immediately, mortgagors who are laid off can apply for a moratorium on all loan payments of three months in the first instance. The NHT will also provide a special one-off offer to contributors, the option to reschedule delinquent loans. The option will only be made available where the Trust has not already entered into a commitment to dispose of the property.
The opportunity will be extended for 6 months, effective April 1, 2020. During this period, the NHT will consider each mortgage on a case-by-case basis, with the option to extend the tenor of the loan or reduce the interest rate.
The measures include:
- Effective April 1, 2020 the NHT will reduce interest rates on all new loans by 1% (benefitting some 8,000 new mortgagors annually)
- All existing NHT loans will be reduced by 0.5% (benefitting some100,000 existing mortgagors).
- Interest rate discounts currently offered to special groups, such as mortgagors aged 55 years and over, the disabled as well as public sector workers will continue.
- The interest rate discounts for the disabled will be effective April 1, 2020 and will also be extended to include the parents of disabled children.
- The NHT will expand the Intergenerational Mortgage Program. Beginning April 1, 2020, the NHT will extend this benefit for eligible applicants for other loan products, such as open market purchases and construction loans. Funding under this Program will be capped at the prevailing loan limit.
- The NHT will also provide greater benefits to contributors over 65 years. Persons in this category will be designated as Voluntary Contributors and therefore be able to access housing benefits with tenures extending up to age 70.
- The NHT will establish a special arrangement whereby, following maturity of the loan, the insurance arrangement at special rates may be continued. The cost savings will enable beneficiaries to continue the protection of their properties in a period of life when their earning power may be at its lowest.
- The NHT will, during FY2020/21, seek to leverage its current mortgage loan portfolio through a securitization transaction to generate additional inflows.