ICC releases set of tax measures to save small businesses in response to COVID-19

ICC releases set of tax measures to save small businesses in response to COVID-19

The International Chamber of Commerce (ICC) has released a set of tax measures to support business continuity and minimise economic disruption caused by COVID-19.

Micro-, small-, and medium-sized enterprises (MSMEs) are the backbone of the global economy, accounting for 90% of businesses and more than 50% of employment worldwide. As part of a global call to take urgent and decisive action to Save Our SMEs, ICC has outlined key tax measures that governments can implement to ensure stimulus efforts flow rapidly into the real economy and provide direct and immediate support.

The statement outlines short-term measures to reduce compliance burdens, including flexibility in extending deadlines for tax filing payments, and measures to increase the short-term liquidity of MSMEs. These include measures such as the deferral or waiving of tax payments, flexibility measures for debt payments, temporary tax refunds, and cash-flow assistance to MSMEs. Looking ahead, the statement also calls for additional assistance to MSMEs to bolster the post-COVID-19 economic recovery.

“Given the cross-border nature of supply chains, such stimulus and safeguard measures should be taken in a coordinated manner at both the national and international levels,” the paper states.
Tax measures outlined in the statement aim to provide direct and immediate support to MSMEs as they continue to navigate the economic fallout associated with COVID-19. As countries consider a broad range of policy tools to effectively respond to the crisis, the ICC statement serves as a best-practice guide against which governments can benchmark their support measures. ICC also supports the Organisation for Economic Co-operation and Development’s (OECD) targeted and temporary tax policy and tax administration measures to relieve the economic repercussions of the pandemic. The OECD maintains a useful compilation of tax measures that governments have taken to help preserve business continuity and curb the negative effects of COVID-19.

The ICC statement is issued alongside a broader set of tax measures and policy considerations aimed at supporting businesses as they adapt their operations to address the challenges posed by the pandemic. The statement urges national governments to avoid unilateral taxes that adversely harm cross-border transactions and underscores the need for an extraordinary fiscal response to the situation as well as on-going coordination and review within the G20. The statement considers the implications of the pandemic with respect to ongoing efforts within the context of the OECD Inclusive Framework to reform international tax rules as a result of digitalisation, and supports continued global co-ordination to help promote harmonisation in international tax policy and provide increased tax certainty for businesses. The statement includes a range of provisions for national tax administrations to consider implementing, such as flexibility in extending deadlines for tax filing and payments. These measures will support businesses and enable a coordinated response to effectively contain the potential human and economic toll of COVID-19.

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Corporate Call to Action – Supply Chain Leadership during COVID-19

Author: The FINANCIAL


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