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The Federal Council wants to support companies especially affected by the crisis in the Crown with one billion francs. The conclusion is that the federal government pays 680 million francs, the cantons pay 320 million francs. At least if Parliament gives the green light in the winter session.
Details are now available on which companies are eligible for the windfall. The Federal Council approved the corresponding hardship ordinance on Wednesday. It goes into effect on December 1.
These are the most important key points:
- Sales are down more than 40 percent: According to the law, there is a potential hardship if annual turnover is less than 60 percent of the multi-year average. In the draft ordinance, the Federal Council stipulated that compensation for short-time work and Covid income replacement must be added to sales in 2020, as many companies were able to make up part of the lost income in this way. That created resistance. The Federal Council now leaves the cantons to decide whether or not they want to include this compensation.
- Minimum turnover of 100,000 francs: Before Corona, a business must have generated at least 100,000 Swiss francs in sales to be eligible for hardship contributions. The money order still had a lower limit of 50,000 francs. “The increase is intended to prevent the scarce administrative resources of the cantons from being used to process micro-business applications,” the press release said.
But this increase is drawing massive criticism from the trade association: “The Federal Council is changing,” the association wrote in a press release. Most of those who participated in the consultation asked for a limit of 30,000 Swiss francs. The new limit “de facto leads to the exclusion of around 50 percent of the companies from the instrument; most of them are micro-companies with fewer than 10 employees.” - State participations: Companies that belong to part of the municipalities or cantons should only be able to apply for help for difficult living conditions if the state’s share is less than 10 percent. The ordinance now provides for an exception: Businesses that are owned by more than 10 percent of smaller communities with up to 12,000 residents (for example, ski lifts or chairlifts owned by mountain communities) are eligible.
- Dividends / Royalties Prohibited: A five-year dividend or royalty prohibition applies to À-fonds-perdu contributions. This becomes obsolete when the withdrawn amount is refunded.
- Execution facilities: Individual prerequisites for support will be removed or adjusted. In particular, there is no requirement that any Covid solidarity guarantee loan must be completely exhausted. Cantons should also be able to pay À-fonds-perdu loans and contributions to a company at the same time; the draft did not include any accumulations.
One thing is clear: the cantons have a lot of room for maneuver. A new competition patchwork quilt and distortions are scheduled. The Deputy Minister of Finance, Ueli Maurer (69), is also aware of this: “There are different problems in the cantons, then there will be different solutions, we accept that,” he said last week. And: “The cantons sometimes have to say no. Not all hardship cases deserve taxpayer support. “
136 million for Zurich
The hardship ordinance also defines the distribution key for the cantons. This depends on the number of inhabitants and the gross domestic product of the respective canton.
The canton of Zurich can raise the most money in federal Bern: up to 136 million Swiss francs. The canton of Bern receives around 81 million and Vaud around 60 million. At the bottom of the table are Obwalden with 2.7 million, Uri with 2.2 million and Appenzell Innerrhoden with a good million francs.
A reservation still applies: Parliament has yet to approve the funds. A first tranche of 200 million federal should flow as quickly as possible, the remaining 480 million a little later.
But now the cantons are on the trigger. Now they have to implement the ordinance in their cantons; here too the pace of progress is different. If you pick up the pace, you can distribute the money faster.
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