News about situation in Holland

Published on 17 February 2021 in Partner meeting

Febr 17 news site NU.NL in Holland :

“Experts expect a peak in the number of bankruptcies of Dutch companies in the fourth quarter of 2021. Until now, such a wave has failed to materialize, partly thanks to government support measures. This is stated in the Special Management Barometer of accountants firm PwC and Leiden University, which was published on Wednesday. The fact that most bankruptcies are expected in the last three months of this year does not mean that companies will not go bust in the short term. Because the number of bankruptcies in 2020 was very small, 71 percent of the surveyed experts think that the number of bankruptcies will increase in the next quarter. But the peak is for later, 31 percent think. This peak is expected a quarter later than the expected peak for special management (financial guidance) in the third quarter. According to the experts, few companies are likely to be successful from special management. The main cause is the arrears of tax liability. Because of the corona crisis, many companies have asked if they can pay their taxes later and have been granted that exception. At the end of last year, the total tax debt was already 13.2 billion euros. That amount is expected to have increased in the meantime. Many catering companies are expected to be under special management However, nearly a quarter of experts believe that not all businesses will be able to pay their back taxes, so they will eventually have to file for bankruptcy. The second cause cited is the changed consumer behavior, forcing companies to reinvent themselves. The largest influx in special management is expected in the hospitality sector. According to the report, 25 percent more pubs or restaurants closed in the first month of 2021 than in the same period a year earlier. ING expects the number of bankruptcies in the hospitality sector to double by 2021. The bank thinks 600 cases will have to stop. The report points out that despite the support measures, catering companies no longer have liquidity buffers and are struggling to obtain additional funding to replenish stocks when they reopen.”

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