Extra help for smallest players in tourism industry?
The grants will be for small players in the tourism market, including private guides, to help cover their losses while there are few or no foreign tourists at all in Iceland. The 3.5 billion króna predicted bill is calculated in a report commissioned from KPMG by the Ministry of Industry and Innovation.
The bill has been approved by cabinet and is now in the hands of Alþingi. Pandemic stimulus bills have a good record of passing Alþingi successfully so far this year.
A statement from the ministry says the grants would cover operational costs (including calculated reimbursements) between 1st April and 30th September 2020. The maximum available will be 400,000 krónur per full-time equivalent position per month, up to a maximum of 1.2 million krónur per company per month for the six months the scheme is expected to run—or a total of 7.6 million per company.
If the bill becomes law, operators must fulfil certain requirements:
Their takings must have been more than 50 percent down between 1st April and 30th September.
The company must have a maximum of three employees.
Applicants must also fulfil requirements on minimum turnover levels, tax liability in Iceland, punctual payment of taxes, fees, and tax returns in the past, and that operations are ongoing.
The statement says the grants will cost 3.5 billion krónur if all eligible operators apply, and the figure assumes that all companies in that bracket have lost at least half their turnover during the summer season.
The statement adds that the grants are a part of the government’s support and stimulus package during the COVID-19 crisis. 4.6 billion krónur in support to the tourism industry has previously been announced.
This article has been updated. The original version indicated the scheme would run for 18 months rather than six, and that each company would receive up to a maximum of 21.6 million krónur, rather than 7.2 million as a result. The anomalous extra 12 months came direct from the initial government press release which was re-issued with a clarification later yesterday.