On 18 March 2020 the President of the Republic of North Macedonia declared a nationwide State of emergency for counteract the consequences of COVID-19.
The State of Emergency is initially set to last 30 days but can be extended for additional 30 days if needed.
On 19 March 2020 the Government of the Republic of North Macedonia announced the following set of economic measures for the companies that will be most affected by the crisis:
Financial support for micro, small and medium enterprises
A total of EUR 5.7 million will be granted as interest-free loans to companies whose economic activities will be most affected by COVID-19. The selection criteria are still under discussion, however the individual loans ranging from EUR 3,000 to EUR 30,000 will depend on headcount:
The loans will be with a grace period of 6 months and repayment period of 2 years.
Exemption of CIT advance payment
The exemption shall be applicable for the months April, May and June 2020 subject to fulfilment of specific conditions to be additionally announced by the authorities. This exemption is intended initially for companies in most affected sectors such as transport, tourism and hospitality, and then also for companies in other affected sectors covered by the measures for prevention of COVID 19.
Decreased rate of the statutory interest and penalty interest
The measures provide for a decrease of the statutory interest by half between legal entities, (from 10% to 5%) and a decrease from 8% to 4% in the relations where at least one party is a legal entity
In addition, the penalty interest for public liabilities shall be reduced by 50%, i.e. from the current 0,03% to 0,015%.
Measures for the tourism and hospitality businesses
The Minister of Economy announced that approx.1.2 million EUR will be dedicated to a 'Tourism Fund'. The funds shall be used for financing of the leisure and hospitality business to mitigate the damages suffered from the COVID-19 crisis.
Subsidizing Social Security Contributions
Another measure provides for subsidizing of social security contributions for companies in transport, tourism and hospitality sectors as well as for other affected companies.
The measure will apply for the months of April, May and June 2020. It is intended the subsidies for social security contributions to be determined with reference to the average salary paid in 2019 per employee.
The eligible companies shall keep at least the same number of employees as in February 2020, and this is applicable from the date of utilization of this measure and provided that (i) no dividends have been paid until filing of the Annual Financial Statements, and (ii) no rewards and bonuses have been paid as of the date of the measure coming into force.
An obligation for companies which have realized accounting profits for 2020 to reimburse, within certain limits, the subsidies for social security contributions, is also expected to be introduced.
The Ministry of Finance and the Public Revenue Office recommended to local commercial banks to consider reduction of the commission fees being charged to VAT registered taxpayers for the provision of periodic statements to the tax authorities concerning the status of the bank accounts of such taxpayers. Decrease by 50% of the fees charged for maintenance of cash registers is also proposed to the entities providing such type of services.
In addition, The Public Revenue Office announced that it will not conduct any enforced collection in respect of all taxes and other public charges (fines, court fees) against those taxpayers who have not paid their obligations.
Also, the authorities recommended reorganization of the working process in the factories. If necessary, the work should be organized in four shifts, in order to ensure that there are less employees in the premises at the same time.
Further measures were announced over the weekend. Once published, we will follow up with a new newsletter.
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