Spain’s army of self-employed workers along with small businesses could be in line for some much needed financial relief under new measures being proposed this Tuesday.
Under the new measures set to be discussed by the Council of Ministers, self-employed, freelancers and SME’s (Small and Medium-Sized Enterprises) could see a moratorium of up to six months on their contributions to the social security system.
The government classes an SME as a business with fewer than 250 employees, however, the cut-off point for eligibility may be lower.
With the economy now in freefall due to the Coronavirus pandemic, the vast majority of self-employed have seen their incomes slashed almost overnight. As a result, many are now struggling to keep up with their obligations to pay their monthly payments, currently set at around €250.
The much-needed support package would benefit around three million of the country’s self-employed workers who make up approximately 18% of Spain’s workforce.
It is believed that the new initiative has already been approved by Spain’s Ministry of Economic Affairs and will now need the backing of Social Security Minister José Luis Escrivá. The Cabinet will then review the impact of the proposals on the welfare system and could then fast-track the new measures once approved.
It is believed that during the Cabinet meeting, ministers will also consider a moratorium on mortgage payments on business premises, similar to those recently granted to individuals to avoid them losing their homes during the crisis.
Support for Renters
Also on the agenda will be private tenants, many of whom will be finding it difficult to keep up with their monthly rental payments.
Under the new measures, loans would be channelled through the country’s banking network and guaranteed by the Official Credit Institute (ICO).
The loans would be available to those who could demonstrate that they had been left in a vulnerable position as a result of the crisis.
Where the landlord was deemed to be a ‘small owner’ with eight or fewer properties, a line of credit would be extended which could be paid back over three to six years.
For tenants whose landlord was a large holder of the property, that is, investment funds, financial entities, real estate and asset management companies, the Government will allow a moratorium of between one and four months on the rent payments to the owner.
The news comes after Socialist Prime Minister announced a €200 billion relief package earlier in the month with measures including the delay of mortgage payments, easing of social security contributions and permitting employees to reduce their workday by up to 100% to care for vulnerable dependents.
Late on Tuesday afternoon (31/03/2020), the government approved the new aid package. Further details can be found here https://www.healthplanspain.com/blog/spain-news/919-spain-unveils-aid-package-for-self-employed-renters-and-families.html
January 14, 2021