20/4-2020

The government and all the Parliament’s parties agree to adjust and extend relief packages to the Danish economy

A number of initiatives in the relief packages are now extended by one month to 8 July. In addition, new initiatives have been agreed to prevent layoffs and bankruptcies.

On March 19, the government and all the parties of the Parliament signed an agreement on comprehensive relief packages for Danish employees and companies. The contracting parties are now agreeing to adjust the relief packages and add new measures so that the relief packages can continue to help even more companies, self-employed and workplaces.

The contracting parties have agreed on the following:

  • An extension of the compensation scheme for fixed costs by one month up to and including July 8, as well as extended opportunities for compensation.
  • An extension of the compensation schemes for self-employed and freelancers by one month until and including July 8 and increased compensation rates. A new compensation scheme for freelancers with mixed A- and B-incomes will also be established.
  • Payment of paid VAT as an interest-free loan to small and medium-sized companies, as well as paid payroll tax to certain businesses, including physiotherapists, dentists and taxi drivers.
  • Postponement of the payment deadline for payroll tax for the second and third quarters for certain professions, including: physiotherapists, dentists and taxi drivers, etc.
  • Temporary suspension of the ceiling on the tax account for the companies' payment of A-tax, VAT, etc.
  • Payments from the tax credit scheme for the 2019 income year are advanced from November 2020 to June 2020.
  • Establishment of a temporary match facility in Vækstfonden.
  • Export and investment package to strengthen Danish export companies and maintain Danish jobs.
  • Establishing a national platform in collaboration with private crowdfunding platforms.
  • An extraordinary boost to the Innovation Fund's Innobooster scheme in 2020.
  • The hourly requirement for earning a senior premium of 1,560 hours of employment over 12 months will be reduced to 4 months.
  • An extension of the suspension of seniority counting in the unemployment benefit system, the temporary extension of the entitlement to sickness benefit and the suspension of G-days until and including 30 June.
  • Furthermore, it must be investigated whether a solution can be found for people who have difficulties being physically at work because they are in a special risk group for infection with COVID-19 for health reasons.

The Government and the Parliament’s parties agree that the extended fixed cost scheme will introduce a condition in the Compensation Orders that applicants, as a condition of receiving compensation for the extended period, must declare by faith and laws, that the companies will not pay dividends or buy back shares for the financial years 2020 and 2021. The condition will apply to companies that receive more than DKK 60 million in compensation in 2020 in the compensation scheme for fixed costs. Companies will later be able to free themselves from these restrictions by reimbursing paid aid under this scheme in excess of DKK 60 million.

The contracting parties agree that companies seeking compensation after the extension of the schemes must pay the tax to which they are liable under international agreements and national rules. This means that companies based in tax havens in accordance with EU guidelines cannot receive compensation, to the extent it is possible to cut them off under EU law and any other international obligations.

The parties also note that the government and the social partners will start discussions on extending the wage compensation scheme.

More information

Companies and organisations can get more information on www.virksomhedsguiden.dk. 

For more on hotlines and who to contact for crisis consultancy please see here.

Source: Ministry of Industry, Business and Financial Affairs