In order to mitigate the economic and social consequences of the health crisis, the federal government has given the cantons the option to provide extraordinary support for “hardship cases.”

This program is intended for businesses whose operations have been particularly affected. Given the urgency of the situation—and although discussions in the Federal Parliament have not yet been finalized—the State Council is implementing the Neuchâtel relief program effective today, for a total amount of 22.2 million francs. The support will be provided exclusively in the form of non-repayable grants.

This tool is part of the overall package of economic support measures and is designed to complement the other support tools currently available. It takes the form of non-repayable financial assistance for businesses that have been severely impacted by the consequences of the current crisis. The purpose of this aid is to enable recipient businesses to offset the losses they incurred in 2020, with the goal of ensuring their long-term viability and preserving, as much as possible, the jobs they provide in our canton.

The aid is intended for businesses located in the canton that are subject to VAT and meet the eligibility requirements set by the federal government, as defined in Article 12 of the COVID-19 Act and its implementing ordinance of December 1, 2020, specifically:

  • A healthy situation before the coronavirus crisis;
  • A decline in revenue of 40% or more in 2020, compared to the average revenue for 2018–2019 (based on VAT returns);
  • A prospect of sustainability contingent on the granting of aid.

To enable every company facing financial difficulties to assess its potential eligibility for the program, a self-assessment tool is available on the website www.neuchateleconomie.ch under the “hardship cases” section.

Eligible businesses will receive aid amounting to between 4% and 10% of their average 2018–2019 revenue subject to VAT. The amount will depend on the decline in revenue experienced in 2020. The aid may not exceed the operating loss (earnings before taxes, interest, and depreciation) incurred by the company in 2020 and will, in any case, be capped at 500,000 francs per company. Eligible companies with an urgent need for liquidity may request an advance payment as part of their application.

To ensure efficiency, given the expected volume of applications and the complexity of the requirements set forth by federal law, applications may only be submitted through a fiduciary firm retained by the applicant company. While potentially eligible companies may already contact their fiduciaries, the latter will be able to submit applications along with all supporting documents from January 11, 2021, through March 26, 2021.
A specific approach will be considered at a later stage for business sectors to which the proposed mechanism does not apply, such as the fairground industry—which is not subject to VAT—or travel agencies.

Since the total amount made available by the Confederation may still be increased in light of the amendments to the COVID-19 Act presented by the Federal Council on December 11, 2020, the cantonal framework is also likely to evolve accordingly. However, the State Council deemed it necessary to adopt without delay the regulations enabling the implementation of the Neuchâtel mechanism, based on the provisions of the implementing ordinance of December 1, 2020, in order to allow businesses in difficulty to take the necessary steps without further delay.

As things stand, the total amount of 22.2 million francs is expected to be allocated as follows: 15.16 million francs for the Confederation and 7.04 million francs to be borne by the canton.

Contact:
Jean-Nathanaël Karakash, State Councilor, Head of the Department of Economy and Social Action (DEAS), tel. 079 670 58 61

 

Information for Trustees Operating in the Canton

Starting tomorrow, the cantonal economic affairs department will host several webinars for trustees to provide a detailed overview of the processing procedure and the application submission requirements.

For more information and mandatory registration, contact www.neuchateleconomie.ch, under the “hardship cases” section.