The government has put on the table two types of measures aimed at halting the effects of the pandemic and returning the economy to a growth trajectory.
The plan envisages additional steps to support businesses and households affected by the new wave of coronavirus cases as well as redesign the type and timing of permanent measures to reduce social security contributions and taxes in the shadow of growing economic uncertainty.
The first type of measures includes extensions to payments of public debts, a mixed system of extending the duration of rent cuts, an extension of the measure of the special 534 euro compensation paid per month and the unemployment benefits as well as the program "Syn-Ergasia” program.
In the next few days, the new support package for the economy is expected to be announced, which will include:
:• Postponement to April 1, 2021 from January 1 for the payment of the first installment of debts to tax and social insurance funds created during the coronavirus period and which froze until September. The measure will provide a liquidity boost to companies and professionals who due to the dramatic drop in turnover are unable to meet their obligations to the state. Debts totaling 3 billion euros that were not paid by households and businesses can be paid in 12 interest-free or 24 monthly installments at an interest rate of 2.5 percent.
• A new model for the extension of rent cuts as at the end of August the obligatory 40 percent haircut on rents in the catering, tourism, transport, culture and sports sectors ends. For industries that are struggling in the pandemic, such as tourism and catering, the extension of the regulation will be mandatory, while for the rest, a voluntary reduction will be made after an agreement between the tenant and the owner.
• An extension to the possibility of suspending employment contracts for October and November in the catering, tourism, culture and sports or other businesses suffering from Covid-19, as well as the extension of the "Syn-Ergasia program. This scenario includes offering the subsidy of salary and contributions for part-time employees until the end of the year.
• An extension of benefits for seasonal and long-term unemployed workers by easing the criteria and activating subsidy programs for new jobs and vocational training
• A new cycle of repayable advance payments in September based on the data on turnover levels in August, which will cover a wider range of companies and professionals with the total amount of aid exceeding 1 billion euros.
Tax breaks come later
The second group of measures concern tax cuts that will be implemented gradually from 2021.
However, new data showing a deeper recession and a bigger hole in the budget have prompted second thoughts in the government concerning the timing and extent of tax cuts and social security contributions.
Finance Minister Christos Staikouras spoke about the preparation of perhaps the most difficult budget for 2021 due to the pandemic, stressing that "with such great uncertainty it is very difficult to document specific policies with characteristics of permanence… We do not know how long the health crisis will last. The budget will include the maximum possible interventions to reduce the consequences for households and businesses and if possible - where possible - there will be interventions in tax policy with tax cuts."