Staikouras: New €36.5 billion support package – What are the new measures?

In the further specialization of young people measures, as announced by the prime minister Kyriakos Mitsotakis, the Minister for Finance, Christos Staikouras, according to which the government It will continue to support households and businesses with measures totaling 36.5 billion euros for the 2020–2021 period.

More specifically, the Ministry of Finance announced the following:

1. Improvement of the terms for Refundable Advances 1, 2, and 3.

It becomes a non-refundable portion of support that was awarded during the first 3 cycles of the Refundable Advance Payment, based on criteria regarding the revenue losses incurred by businesses in 2020.

The exemption applies up to 50%, while it is necessary prerequisite is the preservation of the jobs provided for in each cycle.

The cost of the measure is estimated at approximately 570 million euros.

2. Launch of a new cycle of Refundable Advance Payment 7.

It begins in April, the Refundable Advance Payment 7, which will be granted based on the decline in business revenue during the first quarter of the year.

The exemption rate is set at 50%, provided that the number of employees is maintained through the end of August.

Increased support is expected for the retail trade, the restaurant industry, tourism, and, more generally, businesses subject to restrictive measures, with higher thresholds.

New businesses in the immediate affected sectors, which began operations after December 2019, will be eligible regardless of their revenue, provided they did not receive aid from the last two refundable advance payments.

The cost of the measure is estimated at approximately 1 billion euros.

3. Extension of the repayment periods for refundable advances.

The repayment period is extended for all cycles from 40 to 60 installments, while the option is provided for a one-time refund of the amount, with a 15% discount applied to the refundable amount.

4. Establishment of a new support program for businesses in the form of a subsidy for fixed costs.

A new support tool is being launched to assist businesses and job protection.

This is the subsidy percentage of businesses’ fixed costs incurred in 2020 that have not been covered by the aid provided to date.

Recurring expenses include benefits to employees, social security contributions, energy, water, telecommunications, rent, other operating expenses, interest expense, and related expenses.

The amount of the aid is determined as a percentage of the difference between the fixed costs incurred by the company and the aid it has received.

The purpose of the program is to provide subsidies to businesses that employ at least one worker, in the form of a credit that can be used to pay tax and social security obligations.

The cost of the measure is initially estimated at 500 million euros.

5. Establishment of a new business loan subsidy program called «GEFYRA.».

A new loan subsidy program for businesses is being launched.

The new program «BRIDGE»applies to medium-sized, small, micro, and sole proprietorships, including self-employed individuals, that have demonstrably been affected by the pandemic and meet specific financial and asset criteria.

It is intended for both businesses that are currently servicing their debts and those that are unable to meet their loan obligations.

Its key features program are:

• Subsidy for monthly business loan payments for 8 months.
• Subsidies for both the principal and the interest on the loan.
• Rewarding consistent borrowers with high subsidy rates.
• Criteria that allow tens of thousands of businesses to join the program, with no limit on the maximum amount of debt they may have.

Specifically, for eligible recipients, the government’s contribution amounts to the following percentages:

For performing loans:

90% for the monthly installment for the first quarter, 80% for the second quarter, and 70% for the remaining two months.
Regarding non-performing loans:

80% for the monthly installment for the first quarter, 70% for the second quarter, and 60% for the remaining two months.
The cost of the measure is estimated at 300 million euros.

6. Extension of the suspension of regulated tax obligations.

As was the case in the previous two months, the March installment of the restructured tax obligations for businesses subject to restrictive measures and directly affected by them is deferred to the end of the restructuring period.

The cost of the measure is estimated at 60 million euros.

Meanwhile, the measure to cover the full amount of rent in specific sectors of the economy for the month of March remains in effect, at an estimated cost of 70 million euros.