The Swedish Government has proposed several economic measures in order to mitigate the effects of Covid-19. On 25 March 2020, the Government proposed an "emergency package" for small and medium sized companies including a state loan guarantee for companies with financial difficulties due to Covid-19. The guarantee will be issued to banks, which in turn will provide the guaranteed loans to companies. The guarantee will be administered by the Swedish National Debt Office and is intended to primarily targets small and medium-sized companies, even if there is no formal limit on the size of the company. The maximum loan per company is SEK 75 million (with certain exemptions).
For companies in durable consumer goods, hotels or restaurants sectors struggling financially due to Covid-19, the Government propose to cover half the rental reduction up to 50 per cent of the fixed rent. The support is sought afterwards by the landlord and applies for the period 1 April until 30 June 2020. For sole traders and partners in partnerships, the proposal includes a possibility to set aside 100 per cent of the taxable profits for 2019 up to SEK 1 million as a tax allocation reserve and hence request repayment of the preliminary tax paid for 2019. The tax allocation reserve can then be off-set against possible future losses. Companies made dormant during 2020 in case of unemployment should further be exempt from the rule that a company can be made dormant only once during a five-year period.
On 16 March 2020, new rules on short-term layoffs were proposed in order to avoid layoffs, meaning that employers’ wage costs can be halved, since the Government will cover a larger share of the costs. Even though the employer will reduce the working hours of the employee, the employee will keep 92,5 per cent or more of their salary. The new rules are proposed to enter into force on 7 April 2020, but to be retroactively applied from 16 March 2020. The state will further take the entire cost of all sick pay during April and May 2020.
Further, a liquidity reinforcement via tax accounts has been introduced entailing a possibility for companies to defer payments of social security contributions, VAT and tax withheld from employees' salaries for up to 12 months. Up to three reporting periods may be covered by the deferral. The new regulations are proposed to enter into force on 7 April 2020, but to be retroactively applied meaning that companies can request repayment from the Swedish Tax Agency for preliminary taxes paid.
In addition, the Government has proposed a temporary reduction of employer's social security contributions (only old age pension contributions are to be paid) for 1 March - 30 June 2020. The reduction applies up to 30 employees per company and on wages not exceeding SEK 25,000 per month. The maximum tax relief per employee and month amounts to SEK 5,300, i.e. if the company has 30 or more employees a total reduction of SEK 159,000 per month may be available.
The Government has also proposed increased loan facilities and credit guarantees for especially small and medium sized Swedish businesses by giving Almi Företagspartner AB and the Swedish Export Credit Corporation capital contribution and increased credit framework.
For airlines, the Government proposed on 17 March 2020 that airlines should be able to receive credit guarantees in 2020 for a maximum amount of SEK 5 billion, of which SEK 1.5 billion is intended for SAS. For the cultural sector and sports movement, the Government has proposed financial support due to the economic consequence affecting these sectors by the virus outbreak.