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Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure LU-2021-6/1807 – measures in Luxembourg

New minimis aid scheme for self-employed

Nouveau régime temporaire d’aide de minimis pour les travailleurs indépendants (3.000, 3.500 ou 4.000 euros)

Country Luxembourg , applies nationwide
Time period Temporary, 01 February 2021 – 15 May 2021
Context COVID-19
Type Legislations or other statutory regulations
Category Supporting businesses to stay afloat
– Direct subsidies (full or partial)
Author Patrick Thill (LISER) and Eurofound
Measure added 06 April 2021 (updated 17 November 2021)

Background information

The law of 29 January 2021 establishes a new temporary de minimis aid scheme for self-employed workers in the context of COVID-19.

The Luxembourg government has decided to reinforce the support to self-employed people affected by the financial consequences of the COVID-19 pandemic. On 8 January 2021, the Council of Government approved, on the proposal of the Minister for Small and Medium-sized Businesses, a draft law aimed at introducing a new, one-off, non-reimbursable financial aid for the self-employed.

This measure is a renewal of the measure LU-2020-19/965 .

Content of measure

The law provides for a one-off grant of €3,000, €3,500 or €4,000. It is given according to the income bracket in which the person falls. The subsidy is intended for people who are primarily self-employed and affiliated with the social security system.

Four conditions must be met:

  • The worker must be affiliated with the common social security centre on 31 December 2020.
  • He/she has the necessary authorisations and approvals for the activity he/she carries out as a self-employed person.
  • To be eligible for the allowance, the professional income must be at least equal to or higher than one-third of the minimum social wage. It must not exceed the minimum social wage amount of two and a half times.
  • The self-employed person is experiencing temporary financial difficulties in connection with the health crisis.

Use of measure

The measure has been used by 4.714 companies and in total €14.99 million had been paid to self-employed workers.

Target groups

Workers Businesses Citizens
Self-employed
Solo-self-employed
Does not apply to citizens

Actors and funding

Actors Funding
National government
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Unknown Unknown
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • Unknown
  • Main level of involvement: N/A

Involvement

No information.

Views and reactions

The professional chambers have given their opinion on the draft law 7745 of the law : The employers' chambers (Chamber of Commerce, Chamber of Crafts):

  • to allocate the aid to all self-employed persons in the craft sector, including those who currently have an exemption from paying social security contributions.
  • to provide for recurrent payments for the self-employed.
  • to create a legal basis for replacement income for self-employed people in the event of future crises.

The Chamber of Employees;

  • notes that the amount is very low and does not allow the self-employed to really cope with the difficulties encountered.
  • To add an additional condition to the granting of the aid, i.e. that the self-employed person should have fulfilled his social obligations with regard to the payment of social contributions in 2020.

Sources

Citation

Eurofound (2021), New minimis aid scheme for self-employed, measure LU-2021-6/1807 (measures in Luxembourg), EU PolicyWatch, Dublin, https://static.eurofound.europa.eu/covid19db/cases/LU-2021-6_1807.html

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