Seán Sherlock
Question:97. Deputy Sean Sherlock asked the Minister for Finance if he will address a matter (details supplied) regarding Covid-19 schemes. [34360/20]
View answerThursday, 5 November 2020
Questions (97)
Written answers
The Temporary Wage Subsidy Scheme (TWSS), which was provided for in section 28 of the Emergency Measures in the Public Interest (COVID-19) Act 2020, expired on 31 August 2020. The TWSS has been replaced by the Employment Wage Subsidy Scheme (EWSS), which was legislated for in the Financial Provisions (Covid-19) (No. 2) Act 2020.
The design of the Employment Wage Subsidy Scheme (EWSS) reflects the changing environment around the COVID-19 pandemic which has shifted from crisis mode to one of living alongside the virus, in line with the recently announced Resilience and Recovery 2020-2021: Plan for Living with COVID-19. The Government’s focus has therefore shifted from an employee income support paid via the employer that maintained the existing employee/employer relationship insofar as was possible, to a direct employer subsidy to help support viable firms and encourage employment, including prospective employment of new hires and seasonal workers.
The EWSS operates differently to the TWSS in that it is a flat-rate subsidy that is payable to employers based on the number of eligible employees included on their payroll. Eligible employees are defined as those earning weekly gross wages of between €151.50 and €1,462. The EWSS also re- establishes the requirement for employers to operate the ‘normal’ PAYE system each time they pay their employees and deduct income tax, USC and PRSI. These normal (real-time) deductions were not operated for TWSS or PUP payments, which will be taxed at year end.
On 25 September 2020, Revenue provided an update, by way of public announcement, as to how any tax liability arising on the TWSS or PUP will be dealt with. I am pleased to welcome this fair and flexible approach being taken by Revenue and I am confident that Revenue will continue to work with their customers to minimise any financial hardship to the greatest extent possible, noting that because of our progressive income tax system, in the vast majority of cases, the expected tax liability will be modest in scale.
I have been advised by Revenue that the question of an individual’s entitlements in an employment context, and the question of what wages an employer may or may not be in a position to pay such an employee in light of the impact of the Covid-19 pandemic on the employer’s business, were matters that were outside the remit of the EWSS. Essentially, the scheme has no role in relation to the employer/employee relationship in so far as the terms, conditions and entitlements of the employment are concerned.
For those businesses who may need additional support, I would draw attention to the comprehensive package of other business and employer supports that have been made available since the July Stimulus Plan and Budget 2021 - including the Covid Restriction Support Scheme (CRSS), the Credit Guarantee Scheme, the SBCI Working Capital Scheme, Sustaining Enterprise Fund, and the Covid-19 Business Loans Scheme.
Question No. 98 answered with Question No. 88.