Cabinet approves subsidies for struggling SMEs

Cabinet approves subsidies for struggling SMEs

A woman shopper visits Chatuchak market in Bangkok where most of the stores are closed, the staff laid-off. (File photo: Apichart Jinakul)
A woman shopper visits Chatuchak market in Bangkok where most of the stores are closed, the staff laid-off. (File photo: Apichart Jinakul)

The cabinet has approved in principle the payment of three-month subsidies to help about 480,000 struggling small businesses keep 5 million employees on their payrolls.

Government spokesman Thanakorn Wangboonkongchana said after the cabinet meeting on Tuesday that the subsidy was proposed by the Centre for Economic Situation Administration (CESA).

It was intended to help small and medium enterprises (SMEs) retain staff they might otherwise have to lay off.  

The cabinet assigned the Labour Ministry to work closely with the Finance Ministry to consider tax exemptions for businesses as a form of state subsidy, Mr Thanakorn said.

The Labour Ministry had been asked to prepare a report detailing the proposed subsidies and forward it to a loan screening panel before submitting it to the cabinet for approval.

Details of the proposed scheme:

- Open to private firms operating within the social security system with up to 200 Thai employees. They must register to join the scheme in October this year and will get three month of subsidies, from November to January;

- The subsidy will be at a rate of 3,000 baht per month per head for three months;

- The subsidy will be based on the actual hiring of workers and the number of employees who give monthly contributions to the Social Security Fund;

- Employers must maintain staff levels at 95% or more. If less than 95%, no subsidies will be provided that month. If they hire additional workers they will receive additional subsidies based on the actual number of employees, up to a maximum 5% more than at the start of the scheme.

“These measures are expected to maintain the employment of Thais in 480,122 SMEs each with up to 200 emplyees.  A total of 5,040,176 workers are expected to be on these payrolls,’’ Mr Thanakorn said.

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