From Iceland — Larger Income Subsidies to Be Law Within The Week

Larger Income Subsidies to Be Law Within The Week

Published November 3, 2020

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According to a report on Vísir today, changes to bills on income reduction and closure subsidies have been unanimously approved by the Economic and Business Affairs Committee.

Óli Björn Kárason, chairman of the committee and parliament member for the Independence Party, says that the bill on closure subsidies has not changed much, but that it will now be extended until the middle of next year. Considerable change, however, has been made to the income support grants. It has been decided that further economic action would be taken to help companies during the pandemic, and the Minister of Finance and Economic Affairs proposed that the income reduction subsidy be extended to cover more companies and be valid for a longer period.

These changes mean that the subsidies are now no longer aimed solely at the self-employed or micro-enterprises with a maximum of three employees, but also to all other companies who have experienced a certain drop in their income since the start of the pandemic.

Companies that have experienced a 40%-70% drop can receive up to ISK 400,000 for up to five full time employees. That equates to a total of ISK 2 million per month during the period form 1 April until 31 October, a maximum of ISK 14 million.

Companies suffering a drop in income of more than 70% are entitled to a maximum of ISK 500,000 per full time position over the same period, a total of ISK 17.5 million.

Óli Björn says that the changes in the bill come after comments from companies such as restaurants, who have suffered a sharp decline in income, but did not originally meet the conditions needed to receive the subsidies.

MPs are hoping to get the new bills passed as soon as possible, and for them to become law by the end of the week. It has been suggested that companies who apply for the subsidies would have to wait a few weeks to receive their payments.

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