Payroll tax incentives have yet to create many jobs

THE LABOUR Ministry’s expectations that firms will hire long-term unemployed people thanks to payroll taxes relief has not materialised in first nine months since the law kicked in.

THE LABOUR Ministry’s expectations that firms will hire long-term unemployed people thanks to payroll taxes relief has not materialised in first nine months since the law kicked in.

The firm which gives a work to person who has been registered in the Labour Office for at least one year may apply for payroll taxes relief paying 1.05 percent of his or her gross income instead of 35.2 percent. Just 2,500 firms have used this possibility in nine months hiring almost 6,000 people, Sme daily wrote.

The government expected that around 15,000 long-term unemployed will get job in the first year.

“It is not going to happened for sure,” head of The Federation of Employers’ Unions (AZZZ) Rastislav Machunka said, as quoted by Sme, adding that he stills does not consider 6,000 hired people as a failure.

Moreover, besides payroll tax relief, firms have tapping subsidies meant to encourage the hiring of young people, which has led to the creation of 12,000 jobs. The result of lower payroll taxes project should be evaluated after at least one year of its effectiveness, according to Labour Ministry spokesman Michal Stuška.

Compiled by Spectator staff from press reports
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