Business support measures during the COVID-19 pandemic
Business support measures due to coronavirus
The government has compiled a list of areas that have been hit hardest by the coronavirus pandemic
Check whether a company belongs to an affected industry according to OKVED code on the Tax Service website
Interest-free loans for paying salaries
Banks will issue loans to SMEs from the list of affected industries for salary payments at 0%. First of all, interest-free loans will be available at Sberbank, VTB, SME Bank, Promsvyazbank, Gazprombank, Alfa Bank, and Otkritie Bank.
The loan amount is calculated by the formula = number of employees * minimum wage in the region * number of months of lending.
Loans will be given to companies with a business life of more than one year. The maximum loan term is 1 year. In this case, for the first 6 months, the rate will be 0%, and then increase to 4%.
Deferred rental payment for real estate
The most affected sectors of the economy will be able to get a deferment. According to the “anti-crisis” law, the owner of the premises is obliged to conclude an additional agreement with a lessee on the deferral of payment of rent within 30 days after the lessee applies. The main condition for using this support measure: the agreement must have been signed before the introduction of high alert or emergency.
At the suggestion of the Ministry of Economic Development, while high alert / emergency situations are in place lessees are completely exempt from paying property rents. After the cancellation of special regimes, lessees will be able to pay only 50% of the rent before October 1. Tenants will be able to pay the remaining rent arrears during the period 2021-2023 on an equal monthly basis. Payment of utility bills by the lessee remains unchanged.
Insurance contribution rates
All small and medium-sized businesses (SMEs) will now pay reduced insurance contribution rates. From that part of the salary that exceeds the minimum wage ($ 160 in 2020) you need to pay 15%. Up to the amount of the minimum wage, the rate remains the same – 30%. Fixed contributions for individual entrepreneurs remain unchanged.
Check whether your company is considered SME on the Tax Service website. The criteria can be found at website.
At the federal level, the minimum wage in Russia is $ 160. Constituent entities of the Russian Federation are entitled to establish their own minimum wage.
SME support measures adopted by Moscow City Government during the COVID-19 pandemic
City for business – three packages of measures
Moscow kept all of the previously approved benefits for local companies. In addition to the federal measures, the city has promptly coordinated with businesses and approved three packages of municipal support measures for companies hard-hit by the pandemic.
The anti-crisis measures have directly helped nearly 35,000 companies with over 765,000 personnel. Support has also been provided to nearly 30,000 medics and more than 6.2 million city residents. Accumulated support to businesses has risen to over approx. $ 1,4 billion, and another approx. $ 1,9 billion have been earmarked for social support and healthcare.
The Moscow Government has lifted property taxes and land payments from those property owners in the trade, services, public catering and hotel industries who agree to lower rent by at least 50% (the decrease must be at least twice as large as the sum of the tax reimbursement). In this way, the city has simultaneously supported rental businesses and companies that have rented premises for hotels, offices and shops.
As of 5th of March 2020 and until the emergency regime is lifted, companies can defer payments under trading contracts at non-permanent retail facilities located in recreation parks, museum estates and open-air museums, the Moscow Zoo and other similar places.
Lending and subsidies:
Advertising in online marketplaces
The Moscow Government’s list of anti-crisis measures has been complemented with new subsidies, including one for online advertising of goods and services and online food delivery services. Businesses can get back up to 50% of the commission charged by the aggregator.
The payment can reach $ 8900. The list of approved marketplaces is being constantly updated at businesses’ request. It currently has 16 largest online platforms and food delivery services.
Mandatory Payments and Taxation
Grants for property owners
Moscow authorities have formed a procedure for the payment of grants to owners of commercial real estate. The city will allocate $ 197 million. Funds can be used to compensate property and land payments.
Cashback for exporters
A list of measures to support Moscow exporters has also been expanded. Expenses related to selling goods, services and intellectual deliverables abroad can be reimbursed, as well as money spent on adapting products to introduce them to the international market. This subsidy allows for compensating up to 100% of expenses. The list also includes the reimbursement of expenses on receiving patents, certifying products or management systems and the delivery of goods abroad. The maximum payment is $ 38 thousand (3 million rubles).
In addition, Moscow has adopted a new grant for entrepreneurs who sell goods and services abroad; the grant will amount to 10% of the completed export contract.
Participants of the Moscow Innovation Cluster are provided with subsidies for engineering activities. Companies can offset up to 50% of costs incurred since 1st January 2018 to create or upgrade a product and expand production. The payments can be used to reimburse the expenses for the development of electronic 3D-models of products, technical design, technological and design documentation, production of prototypes, development of a program and test procedure, creation of equipment prototypes as well as the purchase and installation of test stands and installations that are involved in production.
Payments to the engineering sector
The list of engineering subsidies recipients has also been expanded and now includes members of innovation clusters in Moscow registered one year before the application is submitted. In the previous list, the required registration period was no less than three years.
The subsidy will compensate for up to 50% of expenses for developing design documents, prototypes and equipment (no more than $ 641 thousand (50 million rubles).
Subsidies for enterprises during COVID-19
There are 14 types of payments for small and medium-sized businesses in Moscow during pandemic.
The Government of Moscow has also developed a set of social support measures in order to help residents who lose their jobs because of the coronavirus. In particular, a regional compensation payment to the unemployed residents of Moscow was introduced. The total amount of unemployment benefits and new payments is by $ 256 (19,500 rubles) per month. The payment is assigned automatically, without application forms. Such payments can be received by Muscovites who lost their jobs this year and worked for at least 60 calendar days.
Can be useful
Federal support measures
The Russian government has developed measures to support business during the COVID-19 pandemic