The World Bank provides support for firms in Moldova to survive, recover and preserve jobs after the COVID-19 crisis. The COVID-19 pandemic has led to a drastic decline in economic activity in Moldova, with firms and businesses facing serious financial constraints to continuing their activities, paying salaries, and meeting their tax obligations. The World Bank’s assistance package, which restructures the ongoing $15 million Tax Administration Modernization Project, aims to support the Government of Moldova in implementing important tax related mitigation measures to help businesses, IPN reports, quoting a press release of the World Bank.
The restructuring will help the Government of Moldova in implementing critical tax relief measures that will support continuity of business operations and sustain employment levels in the context of the COVID-19 pandemic. The program will specifically implement tax-related conditional subsidy programs aimed at both supporting business survival and protecting employment.
“The restructuring of the Tax Administration Modernization Project is part of the World Bank Group’s COVID-19 Crisis Response,” said Anna Akhalkatsi, World Bank Country Manager for Moldova. “It will support the government’s efforts to save livelihoods, preserve jobs, and ensure more sustainable business growth and job creation. Helping firms and financial institutions to survive the initial crisis shock, restructure and recapitalize is key to sustaining economic recovery and longer-term revenue mobilization.”
The restructuring will also allow the State Tax Service (STS) to procure two IT software solutions to ensure business continuity for the tax agency and improved taxpayer services under quarantine circumstances. That includes a Remote Monitoring System for Tax Inspectors and Data Loss Protection software. Together, these will enable the STS to continue performing functions that contribute to improving compliance and uninterrupted and secure service to taxpayers in the event of the recurrence of the pandemic or similar emergencies.
Since Moldova joined the World Bank in 1992, over $1.3 billion has been allocated to more than 60 operations in the country. Currently, the World Bank portfolio includes 12 active projects with a total commitment of $603.1 million.
The IFC’s committed portfolio in Moldova is $2.25 million ($2.25 million outstanding). Its committed portfolio consists of 28% loans and 72% equity. The Multilateral Investment Guarantee Agency has provided guarantees totaling $14.7 million. Both institutions are members of the World Bank Group.