Government Business Support Measures

Recently, the first package of support measures from the Greek Government were announced, moving in three directions to protect enterprises and employees:

1. Strengthening the health system by at least 200 million Euros in addition to the existing budget.
2.  The possibility of a special purpose leave, the cost of which will be shared between the State, the enterprise and the employee, as well as the legislation of access to work facilities, with flexibility in terms of working hours and facilitation of distance work.
3.  The possibility of suspending the payment of tax and insurance liabilities to companies closed by a state decision, as well as the installments for adjustments made to the tax authorities and insurance funds.

At the same time a second package of support measures was announced to strengthen Greece's economic sector severely affected by the new coronavirus. The announcement of the Ministerial Decisions for their implementation is expected. The most important measures announced for business protection are listed below:

SUPPORT MEASURES FOR BUSINESS AND EMPLOYEES

• Suspensions of business taxes and insurance contributions by self-employed professionals and self-employed individuals, as well as installments for settlement of past debts to the tax office and insurance funds. They concern companies which are severely affected by the emergence and spread of coronavirus, provided that they retain their existing job positions.
• For the aforementioned companies, the suspension of the payments is in force for 4 months (July 31^st), - without interest and surcharges - of the March debt, for VAT, for established debts to the tax authorities or Audit Centers and for installments relating to past debt arrangements. payment of debts assessed and due to the Tax Administration as well as the payment of debt installments or partial repayments due are suspended for affected enterprises. During the suspension period, no late payment interest or surcharges will be calculated.
• In addition, for the self-employed individuals, self-employed professionals and sole proprietors affected (e.g. lawyers affected by the closure of courts) for the period 15 March - 30 April, an aid of 800 euros will be given at the beginning of April. It should be noted that the arrangement also includes individuals who are part-time employees unless they have a full-time employment.
• In addition, it is specified that owners of more than one sole proprietorship are entitled to only one compensation.
• The Independent Public Revenue Office proceeds with immediate repayment of all outstanding liabilities of the State to citizens and businesses, refunding up to 30,000 euros of all cases under review. Since February 25, the date of the first Legislative Act, until March 13, 218 million euros have been returned.

VAT

• VAT reduction to 6%, from 24%, to products needed to protect against coronavirus such as : • protective masks and gloves, • antiseptic products, wipes and relevant products, • soap and other products used for personal hygiene purposes, • ethyl alcohol, if used as raw material for the production of antiseptics.
• All manufacturing activities for the production of antiseptics by industrial and craft enterprises for the benefit of the Ministry of Health are VAT exempt, whereas the relevant input VAT will be deductible.

SUPPORT MEASURES FOR LABOR-IINSURANCE-UNEMPLOYMENT

• For insurance funds, the payment of insurance contributions for the month of February is suspended for 3 months, with no interest and surcharges on affected employees. It also suspends the payment of installments for past debt settlement to insurance funds for 3 months for all affected companies.
• From 18/03/2020 it is forbidden to dismiss an employee in enterprises which their operation is suspended by order of a public authority, and in the event that it takes place it will be considered as invalid. Business compliance will be monitored through the Ministry of Labor's "Ergani" system.
• Retention clause of the employees in all businesses which their operation was not suspended, as a condition of suspension of insurance and tax liabilities and the use of exceptional financial support tools.
• Extension of the payment of the regular unemployment subsidy, as well as the long-term unemployed and unemployment benefit to self-employed professionals and self-employed individuals, for a further two months.
• The eight hundred (800.00) Euro compensation mentioned above concerns every employee in state-owned enterprises, either full-time or part-time, with a contract of employment deposited in the "Ergani" system of the Ministry of Labor. Companies that stop operating by their own decision, the employers are still required to pay salaries to the employees. Interested parties will be asked to fill in a statement on an electronic platform set up by the Ministry of Labor in order to register their bank account. The compensation will be credited directly to the employees. Employers will declare in the "Ergani" system, in a special section to be created, employees who worked in a company that terminated its operation with a state mandate.
• The compensation covers a period of 45 days, from mid-March to April 30, and will be tax-free. In addition, the State fully covers the insurance, pension and health rights of employees and their social security contributions on the basis of their total nominal wages.
• Regarding the unemployed, it is envisaged to extend the regular unemployment benefit, as well as the long-term unemployed and unemployment benefit self-employed professionals and self-employed individuals, for a further two months, to those unemployed whose relative entitlement to benefit ends on 31/3/2020.

SUPPORT MEASURES FOR FINANCING BUSINESSES

• Business financing in the form of a refund of a total of EUR 1 billion. The financing of any enterprises in this form will been taken into account the reduction of its turnover as well as the wage and non-wage costs of its employees. In this case, the preservation of existing jobs is a prerequisite. It will be refunded within the next two months via Taxisnet and will be paid directly into the business accounts.
• Providing of new business loans up to € 2 billion through the European Investment Bank.
• Moreover, € 1.8 billion will be allocated through the Special European Investment Fund created last week to counter the effects of coronavirus spread. The use of the relevant resources will be immediate. Overall, there will be further enhancement of business liquidity by optimally combining funds from the Public Investment Program, the Partnership Agreement for the Development Framework, the Hellenic Development Bank and the European Investment Bank Group, in order to ensure maximum leverage.
• Creation of a guarantee mechanism for granting capital loans to small and medium-sized enterprises, up to € 3 billion, and for investment loans of up to € 500 million.
• An increase of € 250 million in funding from the Hellenic Development Bank's Entrepreneurship Fund for new loans to corporations affected by the coronavirus with a 100% interest rate subsidy for two months.
• Interest rate subsidy for up-to-date business loans for 3 months for sectors of the economy that are directly affected by the coronavirus. Should the crisis continue, the measure may be extended further.
• Suspension of bank payments until September for consistent businesses.

RENTAL AND REAL ESTATE PROPERTY MEASURES

• Companies that are obliged to stop their operation due to the spread of coronavirus will be legally required to pay 60% of the rent of the commercial property, for the months of March and April.
• The same measure applies to employees of undertakings who are compulsorily ceasing their activity due to the spread of coronavirus and whose employment contract is suspended, provided that this is their first residence. Paying 60% of the rent instead of 100% will have no legal effect on the tenant.
• For the owners of real estate in the above cases, it is foreseen to suspend payments of their tax liabilities and payment of installments of partial payment of established debts, for 4 months.
• Suspension of the revision of the real property values. The 2020 “ENFIA” will be based on the current regime and the new objective values ​​will come into force next year.