The government of Lithuania on Monday (16th March) approved an economic stimulus and relief package for businesses affected by the coronavirus outbreak. Measures for at least 2,5 billion Eur are foreseen. In addition, the government is planning to increase lending capacities for at least 5 billion Eur.
The economic stimulus and coronavirus mitigation plan aims to:
2.1. Use public funding up to 3 months to maintain jobs by covering part of the downtime for employees. The employee must be guaranteed at least the minimum monthly salary (60% of public funds but not more than minimum monthly salary. Total amount: 250 million Eur, the funds are planned to be provided from the Guarantee Fund, EU funds).
2.2. To secure sickness benefits for those that take care of the children and people with disabilities when a restrictive treatment regime is put in place at educational institutions or social care and employment centers. (Amount 200 million Eur). Funds to be used from the State Social Insurance Fund, also to be borrowed.
2.3. To pay (up to 3 months) a flat-rate benefit of 257 Eur per month to self-employed people who pay social security contributions when they are unable to carry out their activities due to an established infection control regime. (50 million Eur from the National Social Security Fund, also to be borrowed).
2.4. Extend the period for home loan payment (excluding the bank interest) from 3 to 6 months with a state guarantee.
2.5. To create an opportunity to postpone or settle payments for electricity and gas produced by UAB Ignitis.
2.6. Recommendations to municipalities to postpone the municipal and thermal energy charges.
3.1. To provide tax loans as soon as possible by deferring them or deferring taxes on an agreed schedule, without interest (measure already applied).
3.2. To suspend action to recover tax arrears on the basis of reasonableness (measure already applied).
3.3. To exempt taxpayers from fines (measure already applied).
3.4. To provide the opportunity to defer or postpone payment of personal income tax arrears.
3.5. Increase the guarantee limit of the Agricultural Loan Guarantee Fund and INVEGA by 500 million Eur and extend the terms of the guarantee. To offset the amount of interest actually paid from 50 to 100% for small and medium enterprises (500 mln Eur, State guarantees).
3.6. To provide an opportunity to defer or postpone payments for electricity and natural gas consumed by UAB Ignitis UAB for business customers.
3.7. To recommend the municipalities to defer or set aside utility bills for thermal energy.
3.8. To recommend municipalities to exempt taxpayers from taxes on commercial real estate, land.
4.1. To accelerate investment programs (1,2 billion Eur) by accelerating payments and increasing funding intensity (EU funds and Public Investment program).
4.2. To redistribute EU investment funds to health, employment and business (250 million Eur, EU funds).
4.3. To accelerate the use of appropriations in the State budget for current expenditure.
4.4. To allow the use of all the funds of the Climate Change Program and the Road Maintenance and Development Program and accelerate the program for the renovation of multi-apartment buildings (250 mln Eur, State budget, EU funds, other public funds).
4.5. To establish a COVID-19 Consequence Reduction Fund and enable legal and natural persons to donate funds (private funds, no. LT56 1010 0000 0853 2407).
4.6. To set an additional state guarantee limit for the creation or replenishment of financial instruments at the sovereign risk (500 mln Eur, state guarantees).
4.7. To recommend the Bank of Lithuania to take the following credit institution regulatory measures to increase banks ‘lending potential by EUR 2.5 billion (credit institutions’ funds):