Tax bills of up to €1,470 another kick in the teeth for workers laid off during pandemic - Pearse Doherty TD
Sinn Féin spokesperson on Finance Pearse Doherty TD has slammed the Minister for Finance for retrospectively taxing hundreds of thousands of laid-off workers in receipt of the Pandemic Unemployment Payment, despite it being introduced as an urgent needs payment that is explicitly exempt from tax under the Taxes Consolidation Act 1997.
The Donegal TD said that Section 3 of the Finance Bill, which was narrowly passed at the Finance Committee today, will see PUP recipients taxed for the first five months it was in operation. This is against the explicit provisions of Section 126 of the Taxes Consolidation Act.
Speaking today, Teachta Doherty said: “The law is crystal clear on this issue - you cannot tax the Pandemic Unemployment Payment.
“This decision will tax hundreds of thousands of workers who have lost their jobs as a result of the pandemic.
“This is a retrospective tax with government going back in time to make PUP payments taxable from March. As a result, some PUP recipients now face tax bills of up to €1,470.
"This is the first Minister Donohoe has gone back in time to levy a tax.
"The government has never retrospectively taxed banks or vulture funds through the Finance Bill. But Minister Donohoe has decided to tax the unemployment payments of those who have lost their jobs, through no fault of their own, as a result of the pandemic.
"That is despite the fact these payments were not taxable by law. PUP was introduced on March 13th as an Urgent Needs Payment under Section 202 of the Social Welfare Consolidation Act 2005.
“Section 13 of the Finance Act 2018 amended Section 126 of the Taxes Consolidation Act 1997 to provide that urgent needs payments introduced under Section 2020 of the Social Welfare Consolidation Act 2005 would be exempt from income tax.
“While PUP was put on a statutory footing on August 5th, for the five months from March 13th, the payment was an urgent needs payment and as such not subject to income tax.
“Section 3 of the Finance Bill 2020 retrospectively taxes the PUP from March 13th despite it being crystal clear that the payment was exempt from tax by law from March 13th to August 5th.
“For the government to introduce a law to tax payments that have been made in the past is unheard of.
“After a year of decimated family incomes and uncertainty, this is yet another kick in the teeth for workers who have lost their jobs as a result of this pandemic."