April 2 (SeeNews) - The Croatian government has adopted a second set of financial measures that aim to help the economy and preserve jobs during the ongoing coronavirus crisis, it said on Thursday.
"In addition to these measures, the government will in the coming weeks work on how to restart the Croatian economy and normal business activities once this epidemic ends - as soon as possible and as effective as possible," prime minister Andrej Plenkovic said in a press release following a cabinet meeting.
One of the measures in the first stimulus package adopted in March included the government paying out 100% of minimum net wages in companies if employers do not lay off workers.
As part of the new measures, the government is raising to 4,000 kuna from current 3,250 kuna the minimum net wage it is paying out to the employees of troubled companies for the months of April and May. At the same time, it is also taking over the payment of social and pension contributions for the increased monthly income, which means a further 1,460 kuna per employee, or an overall 5,460 kuna per employee, Plenkovic said in a separate press release late on Wednesday, unveiling the new relief package.
"This measure, when you add April and May to what we have already allocated for March, will cost 8.5 billion kuna for preserving jobs," Plenkovic said, without providing the overall value of the new package.
In addition, firms with revenue of less than 7.5 million kuna, which make 93% of all companies in the country, and have recorded a drop of more than 50% in revenue due to the coronavirus crisis, will not be required to pay profit tax, income tax or contributions.
A third element of the new package is the possibility for companies to postpone payment of value added tax until they receive payment on invoices issued to their counterparties, Plenkovic said.
The latest measures are complemented by new regulations specifically targeted at supporting agriculture and tourism.
Finance minister Zdravko Maric said in a statement on Thursday that 66,000 firms employing more than 400,000 people among themeselves have so far applied for state support under the first stimulus package. The deadline for applying for financial assistance for March will expire on April 5.
The government adopted its first set of anti-crisis financial measures worth 30 billion kuna ($4.3 billion/3.9 billion euro) in the middle of March, including deferral of payment of income and profit tax, social, health and pension contributions by three months, with an option to be postponed by a further three months. The measures also include interest-free loans to municipalities, cities and counties, as well as to the country's health and pension insurance institutes up to the amount of the due taxes and contributions whose payment has been deferred.
Moreover, state-owned development bank HBOR and commercial banks are ready to freeze and delay loan repayments, as well as to provide financing for working capital and for restructuring of existing loans.
The first package also includes special measures to support the tourism sector which contributes some 20% of Croatia's GDP and is among the hardest hit by the current crisis.
(1 euro = 7.62997 kuna)