Corona-Pandemic: Immediate Taxation, Legal Measures and Financial Aid in Ireland, Norway, Lithuania, Georgia, Turkey, Tunisia
Most states worldwide are currently putting together aid packages. The government in Ireland is taking steps to support workers and SMEs, with similar measures being taken in Norway, Lithuania, Turkey and Tunisia. In Georgia, a state of emergency has been declared, with benefits on certain taxes. Our experts summarise the current measures.
With the evolving COVID-19 situation many businesses are facing disruption. The government has announced various measures in terms of legal, employment, taxation, and financial aid:
- Due to the new recommendations and the concerns that workers had for their working capacity going forward, the government and tax authorities have announced updated advice to support workers and small and medium sized businesses who may experience cashflow issues.
- All debt enforcement activity is suspended until further notice.
- The relevant contract tax reviews which affect the construction industry due to take place in March are suspended until further notice.
- Tax returns should continue to be sent on time.
- Extended availability of government subsidised or government guaranteed loan finance will be offered to businesses affected by COVID-19.
- Extended grant availability through Enterprise Ireland, Udaras na Gaeltachta and local enterprise offices specifically allocated for businesses affected by the pandemic.
Meanwhile, Bank of Ireland and Ulster Bank have also become the first banks to assure their customers that practices such as deferrals will be put in place for mortgage holders who may find themselves unable to keep on top of their payments during this time.
Ecovis Ireland has, and will always be committed to providing SMEs and larger business owners with practical and useful advice to help their businesses survive and thrive. We intend to continue that trend during this period of adversity and whatever lies ahead.
The Norwegian authorities have implemented a wide range of changes to unburden companies from losses related to the crisis. These changes include reduced national insurance, higher salary percentage during temporary layoffs, shorter notice periods and state guaranteed liquidity loans.
The tax authorities have implemented delayed due dates for VAT returns and filing national insurance, in addition to postponed pre-tax payments.
ECOVIS Norway are experts in assisting foreign companies to navigate the bureaucratic jungle and we are keeping up with the latest changes related to the corona crisis to help clients survive the difficulties.
Responding to the implications of COVID-19 for businesses, the State Tax Inspectorate (STI) under the Ministry of Finance of the Republic of Lithuania has issued a statement containing details of tax relief. One of the provisions is the ability for taxpayers who experience temporary financial difficulties to approach the tax administrator with a request to postpone their tax debt (underpayment) or have it paid in instalments. In such cases, the taxpayer and the tax administrator will enter into a tax loan agreement (TLA) and the tax will be paid under the schedule laid down therein.
The STI has delayed the deadline for advance profit tax declarations by two weeks (until 30 March 2020). Taxpayers who are facing operating challenges due to COVID-19 and want to pay their advance profit tax based on the expected performance result will be able to file their advance profit tax declarations for the first quarter of this year by 30 March 2020 instead of 16 March. The STI has moved the deadline for personal income tax declarations from 4 May to 1 July 2020.
ECOVIS ProventusLaw has been delivering legal alerts from the beginning of the crisis and will provide immediate updates on additional measures released by the authorities.
The government will adopt a new economic package worth TRY 100 billion called the “Economic Stability Shield” in order to reduce the negative effects of COVID-19. Not all the details have been announced, but Ecovis Turkey will inform all clients quickly once the measures come into effect. These include:
- April, May and June withholding tax, reverse charge VAT (VAT2) and social security payments will be delayed for six months for some sectors.
- Accommodation tax will not be applied until November 2020.
- The right of easement and contribution share payments for hotel leases will be delayed for six months for April, May and June.
- The VAT on domestic airline transportation will be reduced from 18% to 1% for three months. Small and medium sized enterprises affected negatively by COVID-19 can obtain loans from the Credit Assurance Fund with an increased limit of TRY 50 billion, up from 25 billion.
- Payments of taxes retained at source, such as withholding tax, are delayed for three months.
There are more measures in the pipeline. Ecovis Turkey will deliver all the details and solutions to clients on our website and through mail alerts.
Following containment measures and recent government decisions to deal with the spread of COVID-19, the government is taking the measures to support businesses in difficulty by:
- Extending the deadlines for filing corporate tax returns by 3 months.
- Extending the CNSS declaration deadline for the 2nd quarter of 2020 by 3 months.
- Suspending all tax audits in progress and extending deadlines.
- The possibility of requesting a 6-month suspension of credit payments to banks.
- The possibility for solely export companies to sell 50% of their production on the local market (currently 30%)
- Accelerating the reimbursement of VAT credits
Ecovis Tunisia aims to support its clients in getting through the pandemic period.
A state of emergency for the entire territory of Georgia was declared on 21 March 2020, lasting until 21 April. Two cities are in lock down. No more than 10 individuals are allowed in closed spaces and inter-city transport is restricted. All facilities are closed except for banks, fuel stations, pharmacies and food markets. Government agencies have switched to remote working. Private companies have been advised to switch to remote working as well. Borders are closed and flights are restricted.
Tax duties have been postponed until 1 November 2020 for businesses operating in the tourism industry (accommodation services, catering services, tour operators, transport services, excursion services, conference services, entertainment services, any other business performing an organised service to tourists).
Benefits are applied to the following taxes:
- Taxes withheld at source of payment (income)
- Annual income tax return
- Annual property tax return
Banks have postponed loan payments for natural and legal persons for 3 months but until now, no official financial aid policy has been released. Ecovis Georgia will deliver the latest policy details once any further measures are released.