Miriam Constantin’s Business Optimism Review is back with its fifth installment of the series. In this episode, Miriam explores the most friendly and innovative measures taken by countries around the world.
The pandemic has caused governments all over the world to come up with innovative measures which we can get inspiration from too.
If you’re part of a professional body, association or government consultation forum, you can take any of these ideas further. Also, it is instrumental to go beyond the regular “survival measures” which most of the states have taken, and also infuse businesses with sufficient aid to restart and further invest in their operations properly, not merely cover losses.
To this end, some of the most innovative measures are listed below.
France has established specific measures for hotel and restaurant businesses which have been heavily hit by the pandemic crisis. France has approved a solidarity fund which remains open to businesses in these sectors even after the month of May. Conditions for accessing it will be extended to those businesses in the sectors concerned which have up to 20 employees and turnovers of €2 million, and the ceiling for subsidies which can be paid under the plan’s second phase will be increased to EUR 10k.
Micro-businesses and Small and Medium-Sized Enterprises (SMEs) in these sectors will be exempted from social security contributions during the lockdown period, from March until June. All these businesses will automatically be exempted, whether or not they have already settled their contributions. Large businesses in these sectors which are not automatically exempted will be able to obtain long-term deferrals of social security and tax contributions and, on a case-by-case basis, request debt cancellations depending on their financial situation.
Government plans to persuade local authorities to defer propery taxes fixed-rate portion of the tourist tax for the entire 2020.
France has additionally deferred for all companies corporate tax and social contributions, and offered subsidies for the payment of parents staying at home while schools are closed.
Also, France has been approved by the EC a state aid measure amounting to EUR 300 billion for companies, including grants and short-term export credit.
An interesting case is Norway, which relies on R&D to power up the economy. Norway has adopted, among others, specific measures to support research and development (the R&D incentive scheme), some of which are worth mentioning especially because Romanian beneficiaries (in Norwegian-Romanian joint ventures) can benefit from too, are:
- investing arount EUR 100 mil in new innovation projects and will offer grants for new projects three or four times during 2020;
- the maximum loan amount for start-up loans from Innovation Norway is increased from approx EUR 150 mil to EUR 240 million. It is also possible to obtain an extra six months interest exemption on existing and new start-up loans;
- Innovation Norway can grant 75% of the total cost of a project;
- Innovation Norway increases the maximum loan for innovation loans per customer from approx EUR 200k to EUR 500k, and offers interest-free exemption for one year and deduction for two years.
Another interesting measure coming from Norway is the forming of an interest support fund of around EUR 30 mil which will contribute to payment relief through installment deferrals and deferral of interest payments for existing or new innovation loans.
UK has cancelled all property taxes for one year for all companies in affected sectors, and offered guarantee loans.
Austria has deferred all taxes, granted subsidies for companies to bear the economic shock of paying employees working less hours, and specific state aid for family companies.
Germany has deferred all taxes, provided state guarantees for company loans.
China has reduced VAT in the healthcare, hotel, catering, wellbeing and cleaning industries, as well as for all small enterprises.
Italy provided tax deferrals and individual aid to companies affected by the crisis.
Greece has suspended VAT payment for 4 months.
Australia has cancelled tax payment obligations on a case by case analysis.
Though heartily put together by a lawyer and an EMBA student, it does not amount to a specific, legal, financial or tax advice.
It is meant only to present facts, legal provisions, opinions, and data from the optimistic point of view, the kind of details the author and her team wish you to be aware of during this time too.
Should you feel the need to know more or apply some of the ideas presented herein, you should head to your most trusted advisor for a deeper view and a safe travel towards opportunity.