News release | 05/27/2021 | 4:00 pm
The outlook for the economic recovery after corona is positive and the virus appears to be on the wane. Yet there are still many uncertainties for workers and companies. Some entrepreneurs have had to draw heavily on their reserves. The cabinet therefore plans to continue the support package for jobs and the economy in the third quarter of 2021. The cabinet will also take additional measures to help companies with their increased debt burden.
The announced extension of the aid package involves an expected amount of EUR 6 billion. In total, the government has now allocated 80 billion euros to support companies and workers during the corona pandemic.
The cabinet wants to help as many fundamentally healthy companies as possible through the crisis. On the one hand, there is a risk of continuing aid measures for too long, because they make normal economic development more difficult. On the other hand, there is still a lot of uncertainty about the near future and some companies have run out of reserves. The support packages are designed in such a way that their use is breathable: the more loss of turnover, the more support. This also applies the other way around: as the economy opens up further and companies can generate more turnover, they will also grow out of the support packages.
The return to a healthy economy, with normal economic dynamics, is of great importance for the earning capacity of the Netherlands. In view of the current situation and developments, it has now been decided to continue the package in the third quarter. In doing so, the government keeps its finger on the pulse in order to respond to current developments if necessary.
TVL and NOW
The cabinet plans to extend the TVL (subsidy for fixed costs) and NOW (wage support) in the third quarter. In order to better support start-ups, growing companies and companies that have come into trouble with the regular reference period, companies have the choice between two reference periods for the TVL from the second quarter. In addition, the subsidy ceiling for large companies in the TVL will go to 1.2 million euros for the second quarter. The extension and adjustment are expected to involve an amount of EUR 2 billion. In the NOW, the new reference month will be February 2021.
Tozo in TONK
The cabinet also proposes to extend Tozo (support for self-employed persons) and TONK (Temporary Support for Necessary Costs) in the third quarter. The focus of the Tozo in future applications will be more on supporting and stimulating entrepreneurs so that they can get back on their own feet as soon as possible. The repayment of the Tozo loan for working capital has been moved backwards by six months, to January 1, 2022. Until then, no interest will be charged. The term of the loan has also been adjusted from 42 to 60 months. The Minister of Social Affairs and Employment has asked the parties involved to apply the TONK generously and to increase awareness and reach. Several large municipalities have already announced this.
The government is also taking a number of measures to ease corporate debt and improve their financial position.
Merger NOW / TVL
From NOW 3 (the subsidy periods from October 2020), the TVL no longer counts as turnover for the NOW. When applying for the definitive subsidy from NOW 3 onwards, many employers will receive more subsidy as a result of this change. This gives them more breathing space and a helping hand to stand on their own two feet again. This involves an amount of approximately 1.5 billion euros.
Entrepreneurs are allowed to start later and take longer to pay off the tax debt they have accrued because of the corona crisis. They now only have to start paying from 1 October 2022 and there is five years for this. This was three years from 1 October 2021. However, entrepreneurs are expected to start paying tax as usual from 1 July 2021.
The conditions for repayments will also be relaxed further. The interest on collection, an incentive to pay tax debts on time, gradually returns to the old level. This means that on January 1, 2022, the percentage of interest on collection will be set at 1% instead of 4%, and then it will gradually increase to 4% on January 1, 2024.
At present, more than 250,000 entrepreneurs have a deferment of payment amounting to 16 billion euros. This has therefore been one of the important measures to support entrepreneurs in a difficult time. Many entrepreneurs have already (partially) repaid; a total of EUR 36 billion in tax deferments has been left open. Therefore, in order to prevent inequality between entrepreneurs, there is no generic forgiveness of outstanding tax debts.
The cabinet wants to help viable companies for which the above measures are not sufficient to continue. A flexible attitude of the Tax and Customs Administration helps entrepreneurs, especially if other creditors are also lenient. The cabinet is discussing this with other creditors. Round table discussions will be organized shortly to speed this up. For example, easing could include giving up the priority positions of various creditors.
A number of other tax measures taken for corona, such as the payment break for mortgage obligations and the ability to reimburse travel expenses tax-free, will be extended until October 1, 2021.
Agreements have been made with the implementing organizations about lenient rules for repaying excess government aid received. In addition, they offer individual customization as much as possible.
Time Out Arrangement (TOA)
Since the beginning of this year, entrepreneurs have been able to use the Private Agreement Homologation Act (WHOA) to reach an agreement with creditors. This law helps entrepreneurs who have had to incur debt as a result of the crisis. In addition, the government is making EUR 200 million available for low-interest loans for SMEs to restart, expand or adapt their business activities following a WHOA agreement. This TOA credit is part of a set of measures to enable companies to resume business after the crisis.
- The cabinet has looked extensively at additional options for large (retail) businesses. All in all, the cabinet has opted not to introduce a separate subsidy scheme for this. A new scheme is complex in its implementation and very unfocused. Tailor-made support remains the best option to prevent viable large companies from failing.
- The credit guarantee schemes, such as the BMKB-C, KKC, GO-C and the Bridging Loans via Qredits scheme will be extended until December 31, 2021.
- The government will stop the guarantee scheme for reinsurance of supplier credits after 30 June. Thanks to the favorable economic outlook, the scheme is no longer necessary. The insurers will also continue to provide cover without a guarantee from the Dutch state, on the basis of a thorough risk analysis
- The support package for culture and the creative industries will continue in the third quarter of 2021, so that the cultural infrastructure is maintained and jobs are preserved. 25 million euros is available for direct support to cultural and creative self-employed persons and 45 million euros for BIS and heritage law institutions. An additional amount of 25.75 million euros is available for loans to open monuments.
- The support measures for sports, agriculture and horticulture that will apply in the first and second quarter will in principle be extended by one quarter.
- The government has earmarked 42.5 million euros for zoos for the period that they were still closed in the second quarter of 2021. The amount is for ongoing costs, such as care of the animals. Zoos are now open again, with due observance of the necessary measures.
Where can entrepreneurs and workers go?
For questions about the corona support and recovery package, companies and workers can look at rijksoverheid.nl/hulpakket. Entrepreneurs can also visit the website of the Chamber of Commerce for more questions: kvk.nl/corona. Is the answer to your question not listed? Then call the advisory team on 0800 – 2117. Working people and job seekers can also visit hoewerktnederland.nl.
Entrepreneurs register for the credit arrangements with their lender, for example their bank. The wage costs allowance scheme (NOW) runs through the Employee Insurance Agency (UWV) and support for self-employed entrepreneurs (Tozo) through their own municipality. Fixed Costs SME Allowance (TVL) via RVO. For tax measures, entrepreneurs can contact the Tax and Customs Administration.