Following the emergence of the novel coronavirus in the Chinese city of Wuhan in late 2019, Taiwan quickly established the Central Epidemic Command Center on January 20, 2020 to coordinate disease prevention and response measures at the national level. As the virus spread, it dealt heavy blows to many industries and businesses in its path. Taiwan's government responded quickly with a three-pronged plan of disease prevention, industrial relief and economic stimulus: Disease prevention includes strict border controls and local prevention and mitigation strategies. For industries and businesses hit by the outbreak, the government has rolled out relief programs—regardless of industry—with the aims of distributing benefits equally, achieving immediate results, strengthening industrial foundations, and accelerating public works projects.
Taiwan also promulgated the Special Act for Prevention, Relief and Revitalization Measures for Severe Pneumonia with Novel Pathogens on February 25, 2020, authorizing an initial special budget of NT$60 billion (US$2 billion). As the pandemic continued to worsen around the world, the special act was amended to expand the special budget by NT$150 billion. Covering everyone from families and disadvantaged groups to companies and industries, the package provides such support as individual tax breaks, household expense subsidies, industrial relief and business tax cuts.
With the worldwide pandemic hobbling the global economy and showing no signs of abating, many industries in Taiwan are in dire need of economic relief. This prompted the Executive Yuan to propose a second expansion of the special budget on July 23. The proposal, drafted in accordance with Article 11 of the special act, calls for an additional NT$210 billion to continue financing prevention, relief and stimulus measures, including subsidies for workers' wages and business operations, and money for the research, development and purchase of vaccines. These efforts are intended to provide relief to hard-hit businesses, set up comprehensive preventive measures in advance, and keep the nation safe from the threat of COVID-19.
Three types of relief
■ Financial aid: Measures include providing businesses and workers with NT$700 billion in loans, including NT$300 billion in operational and stimulus loans to small and medium-sized enterprises (SMEs); offering generous loan interest subsidies to SMEs; lenient processing of returned checks; subsidizing banks that reduce or forgive interest on old SME loans; and providing relief loans to workers.
■ Employment assistance:To help employees, subsidies are available to supplement salaries for furloughed or short-time workers and to encourage them to undergo training while on leave. Workers who lose jobs during the outbreak will receive the usual unemployment payments, and companies hiring these workers will receive compensation. As for employers, government assistance will go mainly toward stabilizing employment relations. Priority assistance will be given to affected SMEs and high-risk manufacturers for health and safety-focused facility and equipment upgrades during the pandemic. Subsidies have also been expanded to encourage companies to promote a healthier work-life balance for employees..
■ Tax breaks: Business entities facing operational difficulties due to COVID-19 may apply for refunds of overpaid business taxes. Small business entities exempted from reporting their sales amounts will automatically have their assessed tax amounts lowered. Profit-seeking enterprises that lose business income due to COVID-19 may deduct the losses from taxable income. Tax deadlines have been eased to allow taxpayers to postpone payment of taxes or pay in installments. Tax breaks will be given to employers who pay employees during time off due to the coronavirus. Taxpayers receiving government-provided subsidies and allowances may exclude such assistance from taxable income.