Companies can now apply for the second round of federal Corona bridging aid. The second round also includes some changes to the Bridging aid This has been accompanied by a reduction in the required drop in sales to be eligible for coronavirus aid. Instead of having to demonstrate a 60 percent decline in April/May 2020, it is now sufficient for companies if sales in two consecutive months between April and August 2020 have fallen by at least 50 percent compared to the same months of the previous year. Alternatively, an average drop in sales of at least 30 percent over the entire period from April to August 2020 is sufficient. In addition, the funding rates have been raised to 90 percent, the funding caps for small and medium-sized enterprises have been abolished, and the flat-rate personnel cost allowance has been doubled from 10 to 20 percent.
The application deadline for the first phase of bridging aid expired on October 9th. With almost 22,000 applications, 16 percent of all applications totaling over €300 million came from Bavaria. €218 million has already been approved for companies from the Free State. The second phase of bridging aid covers the funding months September to December 2020. Applications for Bridging Aid II must be submitted online by December 31st by a tax advisor, auditor, certified public accountant, or lawyer for the affected company. Processing in Bavaria remains with the Chamber of Industry and Commerce for Munich and Upper Bavaria.
Bavaria's Minister of Economic Affairs Hubert Aiwanger (FW) emphasizes the need for further aid programs for 2021:
"We see that the economic situation in Bavaria as a whole is continuously improving. This makes continued support for businesses and sectors that are not yet completely out of the woods all the more important. The federal government must now promptly discuss Bridging Aid 3 and present concepts for further programs for the period starting January 1, 2021."
Will there be a fictitious company wage for self-employed individuals?
After Bavaria's coronavirus aid for the cultural sector has been criticized so far, the state government is now taking corrective action: The Free State will provide an additional 370 million euros until the end of the pandemic, which the state government currently expects to be next spring. This will be used, among other things, for a solo self-employed program for artists, who can receive up to 1,180 euros per month starting in October. The Free State is modeling this on the solo self-employed program in Baden-Württemberg. There will also be a scholarship program: 5,000 euros each for 5,000 young artists.
In the course of announcing these measures for artists, Prime Minister Markus Söder (CSU) also stated that he supports a similar program for the economy. press conference last Tuesday he said:
"I explicitly state: We will also need additional support for the economy. The issue of self-employed individuals must not only be addressed through the cultural sector, but must also be addressed through a fictitious entrepreneur's wage for all areas of self-employed individuals and employment."
Until now, self-employed individuals without operating costs were largely exempt from state coronavirus aid because only fixed costs were eligible. Therefore, business associations such as the Chamber of Industry and Commerce welcome Söder's statement. Chamber of Industry and Commerce Managing Director Manfred Gößl says:
“An entrepreneur’s wage for the self-employed signals a minimum level of appreciation for all those who usually work independently from home and who are now facing financial hardship due to the coronavirus pandemic.”
Decisions of the Federal Government
Last Wednesday, the German government not only announced new measures to contain the pandemic, but also linked them to new economic aid. Companies, businesses, self-employed individuals, associations, and institutions affected by the temporary closures are to receive extraordinary economic aid. To compensate them for financial losses, companies with up to 50 employees will receive a refund of 75 percent of their corresponding turnover for the same month of the previous year. Different percentages apply to larger companies, which are determined in accordance with the upper limits of the relevant state aid regulations.
In addition, the federal and state governments decided to further extend the aid measures for companies and improve the conditions. Whether a fictitious entrepreneur's wage for the self-employed will be part of the package has not yet been clarified. In addition, the KfW Express Loan will be opened up and adjusted for companies with fewer than 10 employees.
