The Government approved the program for subsidizing interest rates, which is designed to facilitate the enterprises’ access to loans during May 1 and December 31, 2020. Assistance is provided to enterprises that raise loans, no matter for what purposes. The program is part of a bill that also includes the VAT refund program and envisions the reduction of the VAT rate for the hospitality industry from 20% to 15%, IPN reports.

The monthly subsidy will be equal to the monthly interest rate paid on loans taken out under the interest rate subsidization program. The highest value of the loan or loans for which a subsidy is provided represents the cumulative sum of the salary payments declared by the beneficiary to the State Tax Service for December 2019, January 2020 and February 2020. If the loan is larger than the cumulative sum of salary payments, the subsidy will represent the size of the interest rate on the part of the loan that is equal to the cumulative sum of salary payments.

The highest annual nominal interest rate that will be subsidized is 8.76% in national currency and 4.40% in foreign currency. The subsidy will be provided for the interest rates paid until December 2020 inclusive.

The beneficiaries of the VAT refund program are enterprises registered as VAT payers and that register VAT for deduction. The VAT will be refunded by the State Tax Service and the State Treasury within 25 workdays of the application submission day, for the period after the lifting of the state of emergency until December 2020 inclusive.

The Government also approved changes that allow for the reduction of the VAT rate for the hospitality industry from 20% to 15% as from May 1, 2020.

The bill is to be adopted by Parliament.