01.04.2020

Tallinn to implement special measures to support entrepreneurs

Tallinn City Government approved aid measures for the city's business sector to manage the negative effects of the emergency. The aid measures are primarily targeted at businesses that have a contractual relationship with the city or have a big impact on the city’s activities.

„Due to the emergency situation, movement restrictions and the fact that many Tallinners have lost a significant amount of their income, the business owners are in a very difficult situation. The proposed measures are meant to help the city's partners – to improve their cash flow, alleviate burden during this dire situation and help businesses emerge from the crisis,“ said the Mayor Mr Mihhail Kõlvart.

One of the first measures to be implemented is to pay the bills of services provided and goods received within 10 calendar days, instead of the current 21 or 30 calendar days, which improves the cash flow of the companies. The city shall also waive contractual sanctions in the event of difficulties that occur due to the ongoing emergency situation when fulfilling the order or delivery, the deadlines shall be extended by a reasonable time. If possible and necessary, payments in long-term contracts can be spread on a wider period of time.

The city pays a total of about 15,000 bills each month that the new decision on payment deadlines affects. In 2019, the city had transactions with approximately 16,000 entrepreneurs.

The City Government also decided to apply a 50 percent reduction in the advertising tax

Tallinn has also decided to reduce advertising tax by 50%, as the market of outdoor advertising has come to a standstill. Advertisements on the contracts for the use of the building spaces put out for the purpose of advertising and information display are exempted from paying the rent.

The city reduces the rental and usage fees of the contractual partners depending on the field of activity of the contractual partner and the extent to which the emergency situation affects the activity of the contractual partner. All tenants of the city are exempted from paying the rent 100%.

For a limited number of contracts, the situation may be resolved on a case-by-case basis. Up to 100% of the tenants belonging under the Tallinn Market’s administration are exempted from the rent. Tenants who use the city space as office space, will have their rental price reduced by 20 percent. The benefits do not extend to the payment of utility costs.

Tallinn will continue to pay subsidies meant for supporting sports activities and will not collect rent from the various sports venues belonging to the city. “Since the situation is rather complex, we will do everything to support the sports clubs, this means that we continue to aid them via sports activity support mechanism if they can find a way to continue with their work for example, via e-environments,” said Kõlvart.

The costs of cancelled conferences, cultural and sporting events will be reimbursed to the extent that the company has already paid for them. The decision affects companies that have applied to the city for partial support for the event, have received the support, but have been forced to either cancel or postpone the event due to an emergency situation.

The measures are planned to last for three months or until the end of the year depending on the specific measure. These measures will have an effect on the City’s incomes, the City Government is preparing a supplementary budget to take this into account. The impact of the business support package on the city budget can be up to €4M.