Since the onset of the COVID-19 pandemic and the establishment of the state of emergency, following consultations with business associations and the relevant central public authorities, the Ministry of Economy and Infrastructure has proposed a series of fiscal and financial-banking measures to provide emergency support to the business environment affected by the pandemic crisis, as well as a mechanism to subsidise businesses in order to preserve jobs and limit redundancies. These measures included subsidies, tax deferrals, reduction of the base rate on loans, etc., including:

• reduction of VAT for the HoReCa sector from 20% to 15% from 1 May 2020;
• defer payment of income tax from entrepreneurial activity for 3 months;
• postponement, until 25 April, of the declaration and payment of income tax for 2019 by sole proprietors, peasant households (farmers) not paying VAT, economic agents subject to the sector of small and medium enterprises;
• subsidising enterprises and non-commercial organisations that have introduced technical unemployment and/or work stoppage by refunding taxes and contributions on wages paid;
• extending access to unemployment benefit for more categories of unemployed and increasing unemployment benefit to a minimum amount of 2775 lei;
• refund of social security contributions for patent holders, self-employed persons, sole proprietors who stopped their activity during the state of emergency;
• to ensure that banks and non-bank lending organisations have the opportunity to defer loan repayments for natural and legal persons;
• the establishment of the “VAT Refund Programmeˮ, which aims to give VAT taxpayers the right to apply for a VAT refund for a later period, thereby considerably increasing the liquidity of businesses;
• the establishment of the “Interest Subsidy Programme”, which consists of providing support by compensating until the end of 2020 the monthly interest rate for companies taking out loans under the Programme (without restricting their purpose: salaries, working capital, investments);
• Establishment of a moratorium on state controls during the declared state of emergency (with some exceptions associated with criminal investigations, public health risks or those carried out by the National Bank, the Court of Accounts, the National Commission for Financial Markets);
• Cancellation of the obligation to carry out the mandatory audit of individual financial statements for 2019;
• The National Financial Market Commission has rescheduled all supervisory fees for insurers, non-bank lending organisations and savings and loan associations;
• the national legal framework has been adjusted by adding a new chapter to the Labour Code regulating the organisation of telework.

During this period, the implementation of ODIMM’s support programmes for entrepreneurs continued, such as “Women in Business”, “PARE 1+1”, “Youth Support”, “Greening SMEs”, etc. A number of new programmes and initiatives were also launched to support the business environment affected by the consequences of the pandemic. These include:

• SME digitisation programme;
• a new Guarantee Product aimed exclusively at SMEs affected by the pandemic crisis;
• extension of the Credit Guarantee Fund through ODIMM with 50 million lei;
• the Business Incubator Network development tool;
• pilot programme for the creation of Multifunctional Industrial Platforms and the development of 18 Multifunctional Platforms in districts where there are no industrial platforms.

The EMI is currently working on the post-COVID-19 Programme for 2020-2021, which has three main objectives:

• limiting the socio-economic impact of the COVID-19 pandemic;
• economic recovery;
• transition to a more resilient economy.

To achieve the first objective, the programme proposes measures to support the restructuring and settlement of commercial, wage and tax arrears. It also entails the development of operational procedures for quarantine operation, replenishment and replenishment of strategic goods stocks, digitisation of the economy and public services, development of e-commerce, simplification of the procedure for opening, restructuring, running and closing of business, etc.

For economic recovery, such actions as the launch of public and private credit lines, new types of targeted grants, adaptation of business support programmes in terms of eligibility and programme objectives, and support programmes for strategic sectors have been included in the programme. Also, providing state support for the development of the private sector affected by the pandemic by: increasing the ceiling of the SME Guarantee Fund, implementing the programme for the development of local suppliers for the period 2020-2021, developing the mechanism to stimulate industrial enterprises to implement new technologies, implementing the programme for the creation of Multifunctional Industrial Platforms, etc.

The objective of transition to a more resilient economy, economic adjustment will be achieved through a series of measures including the identification of priorities for investments needed for the transition to a more resilient and sustainable economy based on the analysis of the impact of the crisis on sectors of the economy. Another action aims at retraining employees in the affected sectors, creating the skills needed for the new conditions, identifying measures to support start-ups and family businesses, building on the capacities of innovative high value-added SMEs, etc.

Proposals for economic measures in the context of COVID-19