Agreed: first support package – grants and loans – next week

Added Discussion section after merchant note

The Cabinet of Ministers discussed this Friday the issue of approving the description of the subsidy procedure, which was postponed to Wednesday’s meeting, then the Government could not approve it, as it had to wait for the approval of the European Commission (EC).

Aurin Armonait, Minister of Economy and Innovation, recalled that the concept of subsidies had been approved by the Government in the past and that several changes had been made in the procedure in agreement with the EC.

For example, average companies with annual revenues but more than 250 employees are expected to be eligible for a grant, as well as a previous change in the period of calculation of the turnover.

This measure is based on trust in companies, we believe and institutions will enjoy their drop in turnover, which you will indicate, but both the State Tax Inspectorate (STI) and the Lithuanian Business Support Agency reserve the right to verify this description until 2021. December 1 if they match the information you provided. And those whose billing has not fallen will have to pay back the subsidy or part of it, says A. Armonait. I would like to be happy that next week independent companies will be able to start submitting applications in the STI system.

The subsidy measure is intended for small and medium-sized enterprises, but in the past, the limitation on the number of employees was not applied in combination.

It is necessary for mons annual income in 2019. It did not exceed 50 million. EUR or book value of assets in 2019. December 31 did not exceed 43 million. EUR. This criteria for invoicing and book value of assets is a medium-sized company, but the limit of 250 employees has been waived. In other words, if a company has an average turnover in terms of turnover or assets, it may have more employees than the company’s average ceiling of more than 250.

The main criterion for companies wishing to receive a 25% subsidy in 2019. The personal income tax (PIT) paid by the company is a cumulative turnover of at least 30%.

The estimated period during the second quarantine business volume contraction starting in 2020. November 1 to 2021 January 31, 2019 compared to 20192020. period.

If the activities of the company are prohibited from 2020. December, then the change in billing from 2020 is calculated on December 1, excluding data for November.

If the company was established in the period of 2019. November 1 to 2020 November 30, but during the period in which the decrease in turnover is calculated, no income was received, then the second condition is used or the main activity is performed during the quarantine restricted activity flow. New companies that have also paid up to € 2,000 GPM may apply for a grant of € 500.

The following requirements apply as follows: January 1 and at least one employee was employed on the first day of the month in which the grant application was submitted; Until 2020 January 31, the applicant company has paid or accounted for at least part of 2019 the personal income tax (PIT) declared payable.

The company should have presented financial statements for 2019. rinkin. If the company is related to other companies, those companies must also have presented financial statements.

Read more about the subsidy scheme here.

V recalls that two calls for grants will be launched to independent companies and companies linked to other entities.

The participants of the second call will present their support in the Electronic Declaration System (EDS). Once the invitation to fill out the applications is sent to eligible companies, unlike in the first wave of the pandemic, when the invitations to fill out the applications were sent to micro-companies, the STI will not deliver it.

There is no provision for an individual invitation or post. All participants who meet the established criteria will be able to provide support. The autonomous mons, who are already poor, will provide support through ManoVMI. Companies related to other companies will file returns through the EDS. The statement is currently being prepared and will be produced on time, the STI has previously indicated.

The grants and soft loans are part of the first phase of business support for the second wave of COVID-19.

Read more about soft loans here.

Read more about the guidelines for the second aid package, the measures of which are still being developed here.

Discussion after the merchant’s note

There was also a discussion at the meeting about the current concept of the company: that its turnover will be evaluated together with the related companies operating in Lithuania, such an arrangement can prevent several companies from receiving support for their way of management and eliminate groups Lithuanian capital.

I want to believe that there was a mistake. These measures have eliminated at least Lithuanian capital companies, which are managed according to the corporate portfolio management form. For example, if a natural person, an investor, only as a natural person, establishes 10 companies and the turnover of each company is less than 50 million. Eur, that’s what you’re getting. But if the same person establishes a holding company and through it establishes 10 companies, the turnover of each of them does not exceed 50 million. Eur, but the sumija virija, will not receive it, joining the government meeting, says Rta Vainien, Executive Director of the Lithuanian Trade Association (LPA).

Within the hour, together with the LVPA team, I went through each ingsn and each table that the company would fill, requesting grants. There will be two updates for autonomous businesses to get owner-owned micromones faster, and then for affiliate businesses that need more scrutiny. At that second meeting, no one will really discriminate against global holding companies, as we have said, both the CTI and the Government plan to follow common sense criteria, responds A. Armonait, the Minister of Economy and Innovation.

The report distributed to the Government meeting at the LPA indicates that the decision to evaluate individual legal entities rather than groups of companies should be welcomed, but should be the same for companies with Lithuanian and foreign capital.

According to R. Vainiens, there is no state in the EU that supports discrimination based on the origin of capital. According to her, stores of the same size and turnover in Lithuania, which are equally affected, will receive subsidies or not, depending solely on whether they belong to a foreign or Lithuanian group of companies. According to Vainiens, there are not many companies of this type, so it is not a matter of shortage, especially since the maximum limit of 800,000 euros applies to aid.

Vincas Jurgutis, Vice Minister of Economy and Innovation, recalled that the measure is intended for small and medium-sized companies, and during the development of the measure, the assessment of the formal size of small and medium-sized companies was expanded: the criterion of 250 employees was abandoned. people only in Lithuania, so international companies are not valued.

However, if those related mons add up to or boil 43 million. EUR or 50 million. Eur, as in the law of small and medium enterprises, in this case no support is provided, this has been approved by the Government. We have discussed that grant support should be aimed at smaller businesses, and larger businesses should apply for loan services, says V. Jurgutis. When we say that it is not a question of money, the limit of 800,000 million euros is still a question of money, if you contribute 5 mons it is 150 million. We have to increase to 155 million euros. EUR.

Prime Minister Ingrida paid attention to the fact that the issue was related to the assessment of the independence of the company and let EIM together with the Competition Council assess whether the provisions could be clarified to eliminate unfair conditions of competition.

Yes, there may be situations where you belong to a larger group but are independent as a Chinese entity. On the other hand, presence in a group may require having completely different sources of funding and access to liquidity than a company that is in the middle of the economy with its shareholder. I think the question to consider is whether we can find some criteria that are independent, says Prime Minister I. imonyt.

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