Coronavirus: Merchants' federation calls for levy, rental cuts for heartland businesses

Mr Yeo Hiang Meng, president of the Federation of Merchants' Associations, Singapore, said the coronavirus outbreak comes after last year's United States-China trade war, and "could not have happened at a worse time for the retail industry".
Mr Yeo Hiang Meng, president of the Federation of Merchants' Associations, Singapore, said the coronavirus outbreak comes after last year's United States-China trade war, and "could not have happened at a worse time for the retail industry".PHOTO: LIANHE ZAOBAO

SINGAPORE - A federation representing heartland enterprises and hawkers is calling for foreign worker levy, property tax and rental to be cut to help the businesses tide over the coronavirus outbreak.

The Federation of Merchants' Associations, Singapore (FMAS) laid out these proposals on Saturday (Feb 15) during a media conference, noting that some of its members in Chinatown have seen up to 70 per cent of their revenue decline since late January.

It also submitted these recommendations to the Government last week in a bid to help businesses get more support during this trying period.

FMAS president Yeo Hiang Meng said the coronavirus outbreak comes after last year's United States-China trade war, and "could not have happened at a worse time for the retail industry".

Mr Yeo added: "After the trade war last year, we had already seen a significant slowdown in business. This is now a very challenging situation for local companies and they need support to sustain their businesses and emerge from this crisis."

Singapore has more than 100 hawker centres and around 20,000 heartland retailers.

Adviser Kwek Theng Swee noted that some companies have seen their revenue fall by 30 per cent due to the ongoing virus situation, and in the worst-hit cases, even 70 per cent.

"Operation costs keep going up, with rentals as the biggest portion, while revenue slides. We need a big exercise to help these people," Mr Kwek said.

The federation proposed that the Government could reduce property tax by 30 per cent, such that landlords can then slash rentals by 15 per cent for tenants. Landlords can only get the property tax rebate after they have reduced rental, with the Government matching the percentage one-for-one.

 
 
 

Mr Kwek, who is also chairman of the Heartland Enterprise Centre Singapore, noted that steps have been taken by some landlords, such as Jewel Changi Airport, which has offered its tenants a 50 per cent rental rebate for February and March.

For businesses with cash-flow issues, the Government could provide a six-month short-term loan, the federation said.

It also proposed a cutting of the foreign worker levy as enterprises might be paying for workers from China who have not returned to Singapore or have been quarantined. Businesses whose workers are affected can have full exemption of the levy during this period, while others can get a 50 per cent exemption for a year.

Mr Yeo said: "We hope for some adjustment to support employers. In some cases, the worker is not here yet and if employers want to hire someone new, they have to retrain the person as well."

The Government could also activate the wage credit scheme, which co-funds wage increases for Singaporeans, to help employers retain their workers during the current crisis.

To boost consumer spending and revive retailers, the federation recommended $300 vouchers to be distributed to households.

"In general, footfall has reduced everywhere, even in places apart from tourist spots like Chinatown and Orchard Road, as people prefer to stay indoors," Mr Yeo said.

 
 
 

Crowds have thinned by some 20 to 30 per cent in hawker centres and markets, said Mr Anthony Low, chairman of the FMAS hawker division.

He also asked for masks for hawkers, who have to handle food and interact with many customers in a day.

But besides Government measures, businesses have to do their part to innovate and keep up with new consumer demands for their long-term survival, Mr Kwek said.

"Our businesses should take the chance to digitalise, have their own websites and even provide residents with self-collection services, for instance. People are online shopping now and this trend will not reverse itself. We have to encourage firms to change their mentality and business models."