Zhejiang's privately owned companies backed by local measures

Specific policy measures will be implemented to maintain the sustainable growth of privately or individually owned businesses in Zhejiang province amid the ongoing COVID-19 pandemic, according to a circular issued by the provincial government recently.

It issued 25 measures to reduce operating costs, provide special subsidies, strengthen financial assistance and optimize the business environment.

In Zhejiang, there are 5.547 million privately or individually owned businesses, accounting for 63.2 percent of the province's market entities, providing jobs for nearly 12.5 million people.

Ten measures will be applied to reduce operating costs, including expanding preferential tax policies for small and micro enterprises. The measures clarify that privately or individually owned businesses that are small-scale contributors to the value-added tax－with monthly sales of less than 150,000 yuan ($22,530)－are exempted from the tax until year's end.

The measures stipulate that six months' rent in 2022 will be reduced or suspended for privately or individually owned businesses that rent government-owned houses in the county-level administrative areas identified as medium and high-risk areas due to the impact of the pandemic. Three months of rent in other areas will also be reduced or suspended.

Three measures will provide special subsidies. In 2022, employees of privately or individually owned businesses in the food-service or retail industries will be provided with free nucleic acid testing. Consumer discount coupons for goods and services will be prioritized for cultural tourism, food services, accommodations, retail and other industries that have been severely affected by the pandemic and have provided a large number of jobs.

Seven measures will strengthen financial assistance. Banking and payment institutions will be guided and urged to implement policies reducing fees for private businesses. Loans for those businesses will be expanded. Officials said expectations are that 60 billion yuan in operating loans will be provided in 2022.

Five measures will be used to optimize the business environment. Privately or individually owned businesses that are temporarily unable to do business due to the pandemic but that still have a strong willingness and ability to conduct business will be allowed to continue to hold their business licenses until the situation improves.

An online platform with a website and app has also been created to help raise awareness of policies aimed at those businesses. The platform has issued nearly 1.4 billion yuan from the central government to 402,500 of the businesses. In 2021, it promoted 550 support policies, including sending 8.26 million messages to 3.5 million of the businesses.

"To solve the prominent problems faced by privately or individually owned businesses such as high costs, difficulty in obtaining loans and difficulty in further development, we highlight ways to solve their problems and emphasize policy continuity. We have refined and adjusted the policies according to the current situation, and improved the effectiveness and pertinence of the policies," according to an official in charge of the Zhejiang Provincial Market Supervision Bureau who asked not to be named.

Twenty-seven targeted policy measures will be implemented to step up relief for micro, small and medium-sized enterprises in Zhejiang, a key center of the nation's private economy. They include support for employment, epidemic prevention and financing, according to a circular issued by the provincial government on May 12.

The measures are expected to provide more than 200 billion yuan in relief to such businesses throughout the year.

Support also will be stepped up for the implementation of national tax reduction policies, including a phased, value-added tax exemption policy for small-scale taxpayers, VAT credit refunds, deferred payments for some taxes and policies related to export tax rebates.

To assist businesses and stabilize employment, unemployment insurance premium refunds will continue to be provided for enterprises that don't lay off employees or have a relatively small number of dismissed workers.

For enterprises in food services, retail, tourism, civil aviation and road, water and rail transportation, the payment of pension insurance premiums has been suspended for the second quarter.

More than 37.3 billion yuan in various financial subsidies had been offered to enterprises as of May 11, Zhejiang provincial government officials announced at a news conference on May 12.