Greece: The new economic measures of the government

Greece: The new economic measures of the government

The government is taking new economic measures in an effort to address its failure to manage the country’s economic situation due to the effects of the pandemic.

As it seems, based on the announcements of Prime Minister Kyriakos Mitsotakis and the Ministry of Finance, there will be an Issuance of 3rd round of Repayable Advance in August, taking into account the fall in the turnover of companies in June and July. This round will also include sole proprietorships without employees and without cash registers, which belong to the tourism industry.

Also, a formula is being sought to extend the provision for subsidizing 60% of employers’ insurance contributions to the SYN-ERGASIA program for the months of August to October, as well as coverage by the State Budget of employer insurance contributions for the months of July 2020, August and September for companies that have the largest percentage of their turnover in the 3rd quarter of the year.

More specifically, for businesses in the tertiary sector subject to VAT, which during the 3rd quarter of 2019 (July-September) received more than 50% of their annual turnover, employer’s insurance contributions will not be paid by companies and will be covered by the State Budget. The same applies to companies operating in the aviation and shipping sectors. For the employees of all the above companies that are included in the SYN-ERGASIA program, the whole of the employer’s insurance contributions will also be covered.

At the same time, there will be an extension possibility of suspending an employment contract of companies in the tourism industry (hotels, seasonal accommodation, tourist offices), retail trade of tourist items, shops and businesses of all kinds operating within hotel units, as well as businesses in the branches of air and ferry transport.

Reduction of income tax advance

In particular:

Businesses and individuals who are subject to VAT will receive a tax advance reduction, depending on the turnover they had in the first half of 2020 compared to the first half of 2019, based on the following scale:

Zero tax advance also receive:

Businesses subject to VAT in the tertiary sector, which during the 3rd quarter of 2019 (July-September) received more than 50% of their annual turnover.

Businesses belonging to the air and shipping sectors.

Businesses and individuals not subject to VAT; the reduction in tax advance is set at 50%.

The total cost of the above measures is estimated at 3.5 billion euro, of which 2 billion euro are in addition to those announced so far./ibna