Employers hesitant to tap tax break for hiring long-term unemployed

Nearly 1,000 businesses have so far used the possibility to get payroll tax breaks by hiring workers who have been out of a job for at least one year.

Nearly 1,000 businesses have so far used the possibility to get payroll tax breaks by hiring workers who have been out of a job for at least one year.

Within the first three months since the government measure was implemented, companies employed in this way 1,454 long-term unemployed. This means in practice that a firm hired fewer than two employees on average in this way, the Hospodárske Noviny daily wrote in January 30.

The state estimates that some 15,000 people will find job thanks to this measure. Critics opine that one issue dissuading companies from using this tool is the red tape connected with it. They also point to the fact that employers mostly use the hired people for simple jobs requiring no special skills.

To be eligible for the project, a company has to fulfil several conditions: they cannot have any tax debt, cannot lay off anyone within one year – but if they succeed, they pay only 1.05 percent of employee’s salary as a payroll tax, instead of 35.2 percent.

(Source: Hospodárske Noviny)
Compiled by Zuzana Vilikovská from press reports
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