FINANCE

Blueprint for state backing

Government will try to take enterprises off life support, preparing measures in three phases

blueprint-for-state-backing

With support measures likely to exceed 15 billion euros this year, the Finance Ministry is drafting a plan to help the market get through the next 18 months. The plan is split into three stages: The short-term stage, which covers the next few weeks until mid-May, the mid-term part from May to the end of the year, and the long-term one, which concerns 2022.

The primary objective is to get hundreds of thousands of enterprises to stand on their own two feet again, as they have practically been on life support for more than a year. To achieve that and avoid shutdowns and layoffs, state assistance will be extended even after the pandemic restrictions have been lifted and businesses are working normally again.

This week the government will provide details regarding the subsidization of fixed corporate expenses, seen running next month. An eighth phase of the cheap state loans program (known as the “Deposit To Be Returned”) may be offered, given also the prime minister’s statement on Friday about food service resuming after Greek Easter (which is on May 2 this year).

Options on unpaid checks are also being weighed. Their combined value has now topped 1 billion euros. After a forced extension, the government may grant an additional grace period after the market reopens. There may be some support of that sort to other sectors, along the lines of the working capital offered to food service companies, starting with tourism.

Over the next few days the details of the income tax declaration method will be announced, so that taxpayers can avoid any nasty surprises with fines and additional tax dues, as well as enjoying more time to pay off this year’s obligations.

In June the government will decide whether the corporate income tax deposit will be reduced again, while the long-term measures will include the freezing of the solidarity levy for 2022 too, and the further reduction of the social security contributions for employers and employees, provided there is the necessary fiscal leeway for next year’s budget.