On 31 March 2020 the Ministry of Finance announced financial support measures to the economy. The total value of announced measures is EUR 5.1 billion and package includes 4 segments: measures regarding the tax policy, direct support to the companies regarding the employees, liquidity support and direct financial support to each adult in Serbia. These are currently available details for each segment:
Measures regarding the tax policy include:
– Delay on payment of payroll taxes and contributions for all companies, during the state of emergency or for at least 3 months period; this shall be an option for the employers. The duty could be delayed until the beginning of 2021, after which a further delay of 24 months at the most could be sought;
– Delay on payment of the income tax due for 2nd quarter of 2020; option to be delayed until the beginning of 2021;
– Delay on property tax due for the 2nd quarter of 2020; option to be delayed until the beginning of 2021;
– Relief from payment of VAT for donations.
Direct support to companies regarding the employees includes
– Flat rate tax entrepreneurs, entrepreneurs, micro and small enterprises: payment of aid in the amount of net minimal wage (approx. EUR 250), for each employee, during the state of emergency (projected to 3 minimum wages);
– Medium and large companies: payment of aid in the amount of 50% of the net minimal wage for employees temporary not working due to suspension of work or decrease in the work volume or suspension of work due to the order of the competent body, during the state of emergency;
– There shall be a payment mechanism which shall ensure that payments are ultimately received by the employees.
Liquidity support measures include
– State Development Fund’ loans to entrepreneurs, micro, SME and cooperatives, with low interest rate, up to 36 months term including a 12 months’ grace period, for financing working capital, salaries and for payment of public revenues, with the maximum amount depending on the size of the company;
– State guaranteed bank loans for entrepreneurs, micro, SME and farms, for financing liquidity, salaries and business, up to 36 months term with a grace period up to 12 months.
Direct financial support to each adult in Serbia
– One time support of EUR 100 to each adult in Serbia, after the end of the state of emergency (aimed at boosting aggregate demand).
The above said measures shall not apply to those companies which decreased the number of employees for more than 10% compared to the numbers on the day of declaring of the state of emergency (not counting the fixed term employees whose contracts shall expire during the state of emergency). This also goes for companies which have temporarily stopped doing business before the state of emergency has been declared i.e. before 15 March 2020.
The Government also announced a moratorium on dividend payments until the end of 2020, save for public companies and for loss regarding dividend tax per such basis.
The announced measures shall be brought to effect by a regulation to be enacted in the following days. BOPA remains at your disposal for all additional information.