Dr. Andreas Woelfle
Partner
Article
4
The German Chancellor has confirmed that the German Federal and State Governments are willing to "do everything that is necessary and that Germany needs in order to get through this crisis as well as possible". The German Government has pledged to confront all problems associated with the COVID-19 pandemic with decisive economic and fiscal policy measures. Here is what we know so far.
There will be an "unlimited" credit program for companies. Whilst "unlimited" will not mean unlimited, this is good news.
The package envisages a massive expansion of loans provided by KfW, Germany's Development Bank. In addition, the Development Banks of the individual Federal States have a number of funding programmes that they will make available to offset some of the current economic difficulties. In particular, the following facilities will be made available:
The Tax Authorities will show greater flexibility. Options for deferring tax payments and reducing prepayments will be enhanced, and enforcement rules will be relaxed, to assist in improving businesses' liquidity. Key measures are:
A new bill will be adopted to facilitate access to short-time work allowance. We expect the new legislation to come into force in the first half of April, and expect it to provide include the following:
In addition, the promotion of advanced training for employees will be further extended: in particular, there will be higher subsidies if a larger percentage of a company's employees need advanced training. Support will be available where an employee takes a professional qualification retrospectively. This is intended to create an incentive to use short-time work for further training to reskill employees for different jobs which may be required after the crisis.
If you or your team in Germany would find it helpful to discuss any of the above or require any support or guidance, please let us know. We will continue to keep up-to-date with all available support measures and will be very pleased to assist.
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