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Estonia has been given permission by the European Commission to compensate labor costs affecting shipping companies which provide international passenger transport by sea.

 

The Ministry of Economic Affairs and Communications has sent the proposed reimbursement scheme to companies in that sector.


Estonia acquired the permit from the European Commission, allowing the state to turn to the Maritime Administration to partly reimburse social and income taxes for companies providing regular international travel.

 

The ministry's spokespeople said Estonian shipping line Tallink, along with the Estonian subsidiary of Scandinavian firm Viking Line, are prime examples of such companies, with the move allowing them to apply for further state aid.


The permit allows for compensation measures to be used within the next four years if necessary. Preliminary forecasts see up to €3.7 million paid out in support this year to cover labor costs.

 

The numbers for 2021 and 2022 are expected to be €7.7 million and €8 million respectively.


Economic affairs minister Taavi Aas added that turnover for ferry companies has fallen by 85-90 percent due to large drops in passenger travel and cargo.

 

The state has now de-veloped three separate solutions for the sector, also allowing companies to turn to KredEx and the Unemploy-ment Insurance Fund (Töötukassa).

 

In addition to this measure, the state acquired a permit in August to allocate €20 million in state aid to shipping lines and related Estonian-registered subsidiaries, covering up to 75 percent of their lost income after the coronavirus pandemic and concurrent economic crisis.

 

VES/ERR News

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