Summary of State Measures to Reduce the Economic Consequences of the Coronavirus


The federal government has decided to take the following measures to reduce the economic consequences of the spread of the coronavirus:

  1. Extension and simplification of short-time work
  2. Compensation for loss of earnings for self-employed persons, parents and people under quarantine
  3. Rapid liquidity support for companies ("guaranteed COVID bridging loans")
  4. Measures to reduce the fiscal burden and on social insurances
  5. Standstill in debt enforcement; judicial vacations


1. Extension and simplification of short-time work

Short-time work compensation ("SWC") helps preserve jobs by allowing employers to continue paying their employees 80% of lost earnings in case of temporary reduction or complete cessation of work. In normal circumstances, the requirements for short-time work compensation are very strict. Due to the current exceptional situation, the eligibility requirements for SWC have been substantially lowered and its scope of application extended:

  • SWC now also applies to (i) employees in fixed-term contracts and for people engaged in temporary work (ii) apprentices (iii) owners of a business simultaneously employed therein (e.g. shareholders of a GmbH, who work as employees against remuneration in the company) and (iv) employees on call, even if the level of employment fluctuates by more than 20 percent, provided they have worked in the same company for at least six months
  • No waiting period applies, meaning that SWC can be applied as of the first day of work reduction
  • Workers are relieved from the obligation to use up their overtime before receiving SWC
  • Employers are relieved from the duty to submit the form "consent to short-time work" for each employee; it is sufficient that the employer confirms in writing having received the consent of the concerned employees
  • Employers may already request SWC before the ordinary payday (no duty to advance payments to the employee)
  • The previous maximum subscription period for SWC of four months in case of a work stoppage of 85% is lifted for the duration of the extraordinary situation
  • Income from interim employment is no longer subtracted from the SWC during short-time work
  • The SWC accounting will be done in summarized form for the duration of the extraordinary situation to relieve the enforcement authorities in the cantons

If an employer receives SWC, the employer must still pay social security contributions in accordance with normal working hours for concerned employees, i.e. the contributions must be calculated on the basis of the normally owed wages. However, the current government measures also include a moratorium on the payment of social security contributions, meaning that these payments can be delayed without any penalty or interest accruing thereon.

Application in the specific case: The employer must submit the "Pre-registration for short-time work" form to the responsible cantonal office, including written confirmation that the concerned employees agree to the introduction of short-time work. After the SWC has been approved, but no later than three months after the wage payment to the employee, the employer submits the form "Application and settlement of short-time remuneration" to the responsible unemployment insurance fund with details of target hours, lost hours, wages and the necessary operational documents.

2. Compensation for loss of earnings for self-employed persons, parents and people under quarantine

The following people are entitled to compensation for loss of earnings:

  • Self-employed persons who suffer loss of earnings because they are forced to stop their work due to the measures taken by the Federal Council
  • Parents with children under the age of 12 who are forced to stop working due to school closings to look after their children (for self-employed parents, the allowances are limited to 30 daily allowances)
  • Persons who are forced to stop their work due to a quarantine prescribed by a doctor (in this case, the allowances are limited to 10 daily allowances)

The compensation amounts to 80% of the average gross income earned before the entitlement to compensation, but is capped at CHF 196 per day. Compensation can be claimed retrospectively from 17 March 2020.

Application in the specific case: Persons concerned can apply for compensation to the responsible cantonal AHV/AVS compensation fund. The application form can be found here.

3. Rapid liquidity support for companies ("guaranteed COVID bridging loans")

Companies affected by the economic effects of the Coronavirus can apply for bridging loans up to a maximum of 10% of their annual turnover, with the maximum amount being capped at CHF 20 million, from their respective banks. Loans of up to CHF 500,000 are paid out within a short period of time and are fully secured by the federal government. The interest rate is set at zero percent. Bridging loans that exceed the amount of CHF 500,000 are covered by the federal government to 85%, with the lending bank taking a 15% stake in the loan. Such loans can amount to up to CHF 20 million per company and require a more extensive bank review. For these loans, the interest rate is currently 0.5% on the loan secured by the federal government. Companies with a turnover of more than CHF 500 million are not covered by this program.

Extraordinarily, PostFinance (which is not a bank and normally not allowed to issue bank loans) is also allowed to issue bridging loans up to CHF 500'000.

Application in the specific case: Application for bridging loans can be submitted starting Thursday, 26 March 2020, at 8:00 am, following this procedure:

  1. Download the agreement for the loan from here, fill out all required fields and print out the PDF.
  2. Sign the agreement.
  3. Send the agreement to your bank/PostFinance by letter or scan it and send it by email.
  4. The bank/PostFinance will review the agreement and, given all requirements are fulfilled, will directly pay out the loan.

4. Measures to reduce the fiscal burden and on social insurances

On 20 March 2020, the Swiss federal council adopted an ordinance containing various measures in the tax and social security sectors to enhance the liquidity of individuals and companies. Various cantons have introduced or announced similar regulations. This is an overview of the measures taken at the federal level and at the level of selected cantons. The federal council and the cantons can extend these measures at any time. In addition, the standstill in debt enforcement proceedings (see below No. 5) also applies for taxes and social security contributions.

4.1 Federal taxes

4.1.1. Direct federal tax

The general due date for the direct federal tax is 1 March of the calendar year following the tax year. Thus, the direct federal tax 2019 is due on 1 March 2020. The Federal Tax Administration (FTA) normally levies interest of 3 % per year on late payments. The following relief has now been decided:

  • The cantons which are responsible for collecting the direct federal tax are encouraged to extend the payment deadlines upon request of the debtors.
  • The interest rate for late payments is reduced to 0% between 1 March 2020 and 31 December 2020. The interest rate reduction applies to tax invoices due during this period. Thus, the reduction applies to 2019 direct federal tax as well as to older and newer tax invoices including provisional tax bills.

Application in the specific case: For an extension of the payment deadlines, contact the cantonal authority responsible for collecting federal taxes. Interest is waived automatically.

4.1.2. Swiss VAT

As regards VAT, the following changes apply:

  • The FTA waives interest for the period from 21 March 2020 to 31 December 2020, effectively reducing interest for late payments to 0%. No interest from previous periods will be charged during this period.
  • The same applies to customs duties and several special taxes such as taxes on tobacco, beer or mineral oil.

Application in the specific case: Interest is waived automatically.

4.1.3. Withholding Taxes and Stamp duties

The areas of withholding tax and stamp duties are excluded from the agreed waiver of default interests. This means that the default interest is still payable for these taxes (Situation as at 25 March 2020).

4.2 Social securities

For social security contributions (AHV/IV/EO/ALV), the following applies:

  • If social security contributions cannot be paid on time, it is possible to request payment in instalments and deferrals of payments.
  • For the next six months, the compensation offices will waive interests on late payments.
  • No more reminders for social security contributions will be sent until the end of June 2020.
  • Invoices on account for social security contributions can be adjusted at the request of the debtors if the total wages of the company or the turnover of self-employed persons has decreased significantly.

Application in the specific case: Requests for extension of the payment deadlines must be directed to the cantonal compensation office. Interest is waived automatically.

4.3 Cantonal taxes

Some cantons have already issued urgent ordinances to support private individuals and companies. This table provides information on selected cantons:

cavelti altenburger tax
cavelti burkhard altenburger tax coronavirus

For information on other cantons check this list.

Application in the specific case: Contact the cantonal and communal tax authorities at an early stage in the event of financial or liquidity problems.

5. Standstill in debt enforcement; judicial vacations

From 19 March to 4 April 2020, there is an extraordinary standstill in all debt enforcement proceedings throughout Switzerland. Extraordinary judicial vacations apply for the same time period to civil and administrative proceedings.

Application in the specific case: Immediately after the extraordinary standstill in debt enforcement has expired, the ordinary debt enforcement vacations over Easter begin. This means that companies and private individuals can neither enforce debts nor be forced to pay debts until 19 April 2020, including through bankruptcy proceedings. Debt enforcement and bankruptcy proceedings that are already running will (except for urgent matters) also be suspended until after 19 April 2020. Similarly, the extraordinary judicial vacations for civil and administrative procedures lead up to the ordinary judicial vacations over Easter. As a result, civil and administrative proceedings can (except for urgent matters) only be initiated or continued after 19 April 2020.