Greek Gov’t Presents 2nd Package of Economic Support Measures to Battle COVID-19 Effects

Minister of Finance, Christos Staikouras. (Photo by Eurokinissi/ Tatiana Bollari)

ATHENS – The Greek government’s second package of economic support measures to deal with the repercussions of the coronavirus pandemic will total 3.8 billion euros, 2.0 billion of which have already been announced by the government and another 1.8 billion euros from a special fund of the European Union, Finance Minister Christos Staikouras said on Wednesday. He made it clear that a precondition for an enterprise to receive any support was that there should be no lay offs of staff.

The measures announced by the finance minister are:

1. Horizontal suspension of tax and social contribution payments until July 31 for enterprises drastically hit by the crisis. It is estimated that the measure covers around 200,000 enterprises with around 600,000 workers.

2. Financing of enterprises in the form of return advance payment to deal with a reduction in turnover and payroll and non-payroll costs, estimated at around 1.0 billion euros.

3. Workers whose labour contracts are temporarily suspended will receive 800 euros in compensation in early April, while the state will cover their social insurance and health contributions. Also, all tax payment obligations are suspended for four months. This measure will cover around 500,000 workers at a cost of around 450 million euros.

4. For self-employed, personal enterprises, etc, all tax payments are suspended for four months.

5. An additional 1.8 billion euros will be exploited immediately from the special European fund for actions to support liquidity, employment and workers’ incomes.

6. The VAT on hygiene products will be reduced from 24 pct to 6.0 pct until the end of the year.

7. Enterprises shutting down operations will pay 60 pct of their rent for March and April. The same measure will be valid for workers’ primary residences, while a four-month suspension of tax payments and tax settlement tranches has been announced.

8. There will be no changes in existing special property taxes, while new real estate property “objective” values will be implemented from next year.

9. The Greek state will immediately pay all state arrears to the private sector.

10. Banks will present interventions and measures covering enterprises and individuals along with financing instruments to support liquidity. The government has also taken measures to protect the stock exchange.

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