covid19

COVID-19 Countermeasures in Greece

Summary

Area  Title 
Description
Labour law
Social Contributions
Suspension of payment for social contributions, reduction of social contributions payments for self-employed and freelancers
 Tax
Payment suspensions
Suspension of payment of some taxes
Financial support
Corporate Loans Provision
In some cases loans repayment relief might be applied
Other measures
Liquidity Provision
Companies in forced lockdown are entitled to a 75-day extension of their accounts payable claims
Rent relief
Some groups of leasers might have their rental fee reduced. Tax relief for property owners

Labour market

Social Contributions

  • Suspension of payment for social contributions due in February 2020 for three months
  • Suspension of payment of regulated past due social contributions up until February 2020 for three months
  • 25% reduction of social contributions payments for self-employed and freelancer professionals, provided that they have payed current social contributions for Feb-20 and Mar-20 within the deadlines.

Companies should maintain their current employment levels (i.e. no lay-offs), in order to be eligible for the above stated provisions.

Companies that re-open are entitled to maintain up to 60% of their total workforce in temporary cease of employment.

Companies in sectors highly impacted by the pandemic are entitled to maintain 100% of their workforce in temporary cease of employment for May, June and July. Such sectors include hospitality, leisure, tourism, transportation and education.

A special employment mechanism will be put in place from June 1 to September 30, 2020. Its aim is to support employment by subsidising up to 60% of employees’ salary in companies/sectors that are highly impacted by the pandemic, provided that the contractual obligations and right among companies and employees are not altered.

Provision of special unemployment benefit for part-time employees in tourism.

Tax provisions

Payment suspensions

  • Suspension of payment due for the withholding tax until 31 August 2020;
  • Suspension of payment due for VAT until 31 August 2020
  • 25% reduction for April 2020 withholding tax and March 2020 VAT for companies, provided that they pay before the deadline extension of 31 August 2020. This reduction will be netted out with future withholding tax claims.

Financial Statements Reporting Provision

  • A deadline extension is granted for reporting of financial statements until 30.06.20 (31.07.20 for corrections)
    • This provision has various subcategories

Tax Returns

  • The Greek Tax authorities will proceed with immediate tax returns to individual and legal entities in cases of claim up to EUR 30.000
  • Corporate income tax downpayment will be returned for March, April and May. This is the 2nd phase of the same measure, totalling to a relief estimated to EUR 2bn by end of June. Additional reduction will be applied in case of companies that will have cumulative sales drop higher than 20% y-o-y for March, April and May
  • Corporate income tax downpayment rate will be reduced with details to be expected

Other Tax Measures

  • VAT provision: VAT is reduced from 24% to 6% for products related to protection from Covid-19 (i.e. masks, gloves, antiseptic products, personal hygiene products, soap, etc.)
  • Transportation sector: VAT is reduced from 24% to 13% from June 1 till October 30, 2020.
  • Similar VAT rate reduction will apply for coffee, non-alcoholic beverages, tourism, cinemas, etc.
  • Property tax will incur no changes for 2020. Application of new property tax rates is postponed until 2021.

Financial support

State subsidies & Loans

  • EUR 2bn leveraged to 7bn of state subsidies and loans will be provided, under the form of delayed tax income down- payment. The maximum amount per company is EUR 0.5m. The criteria for companies to be eligible for these subsidies are sales/turnover reduction and labor cost. Companies should maintain their current employment levels (i.e. no lay-offs), in order to be eligible for the above stated provisions.
  • Provision of state guarantee of up to 80% of the total SME and large corporations debt portfolio
  • Working capital interest-free loan provision for the first two years and for 40% of the total loan value thereafter.
  • Examples:
    • Special purpose subsidy of EUR 800 for 45 days for entrepreneurs employing up to 5 employees. The amount of special purpose subsidy will be EUR 534 for May, June and July.
    • Income tax down-payment relief through provision of long-term, low interest loans to impacted companies

Other measures

Corporate Loans Provision

  • Companies with performing loans up until 31 December 2019 are eligible to apply for repayment extension up until 30 September 2020. Interest relief is not applied for these extensions
  • Interest subsidies up to three months will be granted to companies operating in sectors that are directly impacted
  • Individuals, Individual entities and free-lancers that are eligible for the monthly support/subsidy of EUR 800 are also eligible for monthly loan repayment extension up to three months.

Rent relief

  • Companies in sectors that are directly impacted by the lockdown are obliged to pay 60% of the cost of professional leases for March and April 2020
  • Individual tax-payers in sectors that are directly impacted by the lockdown are obliged to pay 60% of the cost of housing leases for March and April 2020
  • Property owners who are impacted by the rent relief are eligible for a four-month extension of their tax obligations and tax payments.

Liquidity Provision

  • Companies in forced lockdown are entitled to a 75-day extension of their accounts payable claims (i.e. bank cheques, promissory notes, bills of exchange, etc), that are due from 30.03.20 until 31.05.20.

Contact Us

Alamanos
Panagiotis Alamanos
Partner
Alamanos
Angelos Alamanos
Partner