Lowtax Network

Back To Top

Collected COVID Occurrences

Kitty Miv, Editor
02 October, 2020

Despite the best efforts of many governments, and some promising recent developments on the testing front, COVID-19 doesn't seem like it'll be going away any time soon, leaving national authorities and international bodies needing to pump the policy levers in order to tackle some of the worst economic effects of the pandemic.

And pump the levers they have been this week, beginning with Egypt, which has recently enacted two laws in response to COVID-19, providing tax relief to businesses, and introducing a solidarity tax on individuals.

Under Law no. 170 of 2020, those earning monthly income over EGP2,000 will be obligated to pay a one percent income tax surcharge on net employment income and a further 0.5 percent on net pension income.

Earlier, Egypt enacted Law no. 152 of 2020, which introduced concessionary corporate tax treatment for micro-, small-, and medium-sized enterprises, with fixed amounts for the former based on turnover levels, and reduced rates for SMEs.

Then in Australia, COVID-19 compliance was the name of the game, with the ATO highlighting non-compliance by some businesses with the rules regarding eligibility for providing JobKeeper payments.

The JobKeeper Payment scheme is a temporary wage subsidy for businesses significantly affected by COVID-19. The ATO explained that although the majority of large businesses are doing the right thing, a small number have been identified that may have manipulated their projections or financial positions to access JobKeeper payments they aren't entitled to receive.

The tax authority went on to reveal that it has also found that some businesses have not kept adequate records to support their enrolment in the scheme. The ATO therefore stated that it was encouraging businesses to review its guidance on eligibility for JobKeeper payments and on the records that should be maintained, and urged them to contact it for assistance if they have made an honest mistake or are experiencing difficulties complying.

In Kazakhstan, meanwhile, the OECD seemed to suggest that more than increased compliance measures were needed on the COVID front, as the recently published Tax Policy Review of Kazakhstan posited that the country needed to boost its economic resilience to cope with the effects and after-effects of the pandemic.

The report observed that Kazakhstan had begun to show signs of economic recovery prior to the COVID-19 crisis as a result of the government's previous tax reforms, but argued that further reform is needed.

The report proposed that the Government's heavy reliance on natural resources could be balanced by increasing some non-resource taxes that have considerable potential for generating additional revenues, for example implementing a gradual transition to a progressive personal income tax system. The report also proposed changes to the taxation of personal income from capital, and suggested that Kazakhstan could improve the design and administration of the VAT and raise additional revenues with a small increase in the VAT rate. The OECD also called for the broadening of the corporate tax base, in particular by better targeting corporate tax incentives and by reducing and improving the design of the simplified tax regimes for SMEs.

In Canada, COVID-wise, the Government announced an extension of the current treatment of furloughed employees under the COVID-19 wage subsidy program to October 24, 2020, and in Ireland, additional information was published by the Revenue on the taxation of the Temporary Wage Subsidy Scheme and the Pandemic Unemployment Payment.

The TWSS was introduced in March 2020 and enabled employees of employers who were affected by the COVID-19 pandemic to receive support directly from their employer. The TWSS was replaced by the Employment Wage Subsidy Scheme (EWSS) as of September 1, 2020. The PUP is available to employees and the self-employed who have lost their job due to the pandemic.

On September 25, 2020, Revenue announced further details in relation to the taxation of the TWSS and the PUP, revealing that additional information and support will be available for those receiving benefits under the schemes to assist them to comply with new tax liability reporting requirements.

Until next week!


About the Author

Kitty Miv, Editor

Kitty was born in Argentina in 1960 to a Scottish cattle rancher and his Argentine wife. Educated in Edinburgh and at Princeton, Kitty worked for the World Bank as an economist, where she met and married an emigre Iranian banker. During her time with the Bank, Kitty worked in a number of emerging markets, including a spell in the ex-USSR as a Transition Economies Team Leader. Kitty is now a consultant in Brussels and has free-lance writing relationships with a number of prominent economic publications. kitty@lowtax.net


« Go Back to Blogs

Blog Archive

Event Listings

Listings for the leading worldwide conferences and events in accounting, investment, banking and finance, transfer pricing, corporate taxation and more...
See Event Listings »