Tuesday 24th March, 2020 unveiled a massive economic and financial package, as part of its strategic response to the growing worldwide Pandemic, caused by the COVID-19 virus, that has so far killed thousands globally.
Speaking during a press conference, Harris, who also holds the portfolio of Minister of Finance, rolled out a whopping EC$120 Million stimulus plan, that includes support for health, agriculture, business, social security, social services and other critical areas.
The Minister explained that the package comes, “… as part of our plan to protect and prepare our Federation, and to see us through this harsh period of pain and sacrifice should the worst effects be felt here.”
With respect to the financial/economic package, the prime minister announced that “The decisions I announce today will lock down our borders, improve our food security and support our workers, farmers, businesses and homeowners during this period of difficulty and stress.”
STIMULUS PACKAGE
In addition to the current public assistance initiatives, the Government’s stimulus package to cushion the impact of the health crisis on individuals and the economy would include the following:
1. Postponement of the payment of Property Tax from June to September 2020,(No Cost but Cash Flow Impacted)
2. Removal of VAT and Import Duty for six months on the following additional hygiene items:
a. hand sanitizers
b. hand sanitizer dispensing machine
c. disinfecting wipes
d. rubbing alcohol
e. gloves
f. masks
g. protective gowns
3. Removal of Import Duty and Customs Service Charge for six months on the following:
a. Vegetables
b. Fruits
c. Fruit Juices
d. Cough and Cold Preparations
e. Vitamins
(#2 and #3 – $3 million)
4. Waiver of payments for consumption of water for the period April to June 2020 for individuals who have been laid off by businesses or experience a reduction in earnings as a consequence of COVID-19(Cost Unknown)
5. Reduction of the Corporate Income Tax rate from 33 percent to 25 percent for the period April to June 2020for businesses that retain at least 75 percent of their employees($4.8 million)
6. Reduction of the Unincorporated Business Tax rate by 50 percent from 4.0 percent to 2.0 percent for the period April to June 2020($1.0 million)
7. Injection of $10 million to boost production in the Agriculture Sector and ensure greater food security for the Federation
8. Waiver of payments for the consumption of water by farmers for six months (April to September 2020) (Cost Unknown)
9. Provision of an additional $5 million to support the Poverty Alleviation Programme
10. Employees who contract the virus and for whom contributions were made would be eligible for Social Security benefits. The Social Security Board will establish a special fund withabout$10 million -$15 million to assist with income support of up to $1,000 per month for workers whose income would have been impacted by COVID-19. Registered self-employed persons who can show that they have been impacted would also qualify for this support.
11. Provision of additional resources in the region of $12.0 million to capitalize the Severance Payment Fund
12. The Development Bank of St. Kitts and Nevis will facilitate a loan 6 repayment moratorium for six (6) months and the waiver of all applicable late fees and charges to support customers who are impacted by the loss of income due to COVID-19.(No Cost but Cash Flow Impacted)
13. The National Housing Corporation (NHC) will implement a moratorium on mortgages for an initial period of three (3) months in the first instance for affected homeowners. (No Cost but Cash Flow Impacted)
14. The St. Kitts Electricity Company (SKELEC) and the Nevis Electricity Company(NEVLEC)would implement a moratorium on payments for electricity services for affected businesses and individuals for a three (3) month period, April to June 2020.(No Cost but Cash Flow Impacted)
15. Continuation of the Fresh Start Programme with an injection of $5 million to assist poor and marginalized youths by providing access to capital to fund small and medium sized business projects.
16. Provide funding through the Development Bank of St. Kitts and Nevis for mortgage loans to citizens of St. Kitts and Nevis in the amount of $30 million
17. The Government will reprioritize and accelerate the pace of implementation of approved Capital Projects that could have a direct positive impact on the economy
The Government appeals to and encourages employers to continue to remunerate employees who are quarantined. Such persons should have evidence of the requirement to be quarantined.