French Economy Minister Bruno Le Maire presented a plan to help businesses in France during confinement yesterday (October 29) and said the government would financial support that was “even stronger” than during the first lockdown in March.
Mr Le Maire said: “This confinement is a hard blow for all the businesses that will have to close from tomorrow (October 30). I’m thinking, in particular, of the 200,000 shops that will be obliged to close.”
The government anticipates the new support package will cost €15billion. We explain what has been announced so far.
Increased solidarity fund for small and medium-sized businesses
Mr Le Maire said: “All businesses and shops closed due to administrative decisions will receive compensation of up to €10,000. This includes businesses of not just up to 10, but up to 50 employees.”
Also eligible are businesses that do not have to close but will still be subject to losses of at least 50%, such as hotels.
Independent workers can claim aid of up to €1,500 per month “as in March”.
The minister said €6billion has been allocated to the solidarity fund.
Social contributions waived for affected businesses
Businesses with fewer than 50 employees will have a “total exemption” from paying cotisations sociales, meaning social contributions such as social security and insurance payments for employees.
Tourism and events companies are also eligible if they lose over 50% of their turnover due to the confinement.
Independent workers who cannot work due to lockdown will see “their automatic direct debits suspended, with no administrative steps to take on their part”.
Tax credits for shop landlords who renounce one month’s rent
Landlords who own premises that house businesses will receive tax credits if they allow tenants to forego “at least one month’s rent” between October and December.
To be eligible, landlords must be renting space to businesses with less than 250 employees that have been closed administratively including hotels, cafes, restaurants and cultural enterprises.
In these circumstances, landlords can benefit from a tax credit of “30% of the amount of lost rent”.
Partial unemployment to continue
Partial unemployment benefits (knows as chômage partiel), similar to the UK's furlough scheme, will continue for “all protected sectors or sectors that have been subject to administrative closure” as a result of the lockdown, Mr Le Maire said.
This has currently been extended to December 31, at no cost to employers, for eligible businesses such as cafes, bars, restaurants and sports centres.
Other businesses will have to cover 15% of unemployment costs for staff, as opposed to the 40% which was supposed to come into effect at the beginning of November.
Mr Le Maire said €7billion had been allocated to cover unemployment costs during confinement.
Access to State-guaranteed loans extended
Prime Minister Jean Castex announced earlier this week that businesses that wanted to apply for State-guaranteed loads would now have until the end of June 2021, rather than December 2020, to apply.
Loans of up to €10,000 are available for businesses with fewer than 10 employees, going up to €50,000 for businesses with 10-49 employees.
Businesses that have already taken a loan originally faced the first deadline for repayment in March 2021, but this has now been pushed back to March 2022.
Mr Le Maire said: “A restaurant owner, a florist, a mechanic or a book shop that is not able to start repaying its guaranteed loan in March 2021 can, after an examination by the bank, wait until 2022 to start repayment.”
Businesses that do choose to delay repayment will not be considered in default by the bank, as they would under normal circumstances.