200,000 people will lose their jobs as of 1st January

“We firmly believe that close 200,000 people will lose their jobs as of January 1,” says Milena Amon from the association Protector of Entrepreneurship and Small Business Owners of Serbia, says while describing the problems that small entrepreneurs and their employees will face soon.

On Wednesday, the association organized a protest in front of the Ministry of Finance building, where it asked the authorities for support and help the survival of the small business.

“Small and micro enterprises employ about 1/5 of the entire number of employees. We know that the revenues of many of them have decreased by 90%. It’s business logic for company owners to first eliminate those costs that they are unable to pay, i.e. to layoff an employee that they cannot pay,” Amon adds.

The employer’s obligation to keep the employees on whose account they received state aid is January 2021 which is good enough reason that there will be mass layoffs come at the beginning of the new year.

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“That money (state aid) was used to pay partial salaries to employees. However, it was the employer who had to pay taxes and contributions on those wages. Employers have been forced to postpone layoffs for five and a half months which led to many of them generating loss because of these measures,” says Amon.

However, there are options that could resolve the issue.

“Specific assistance should be provided to vulnerable sectors, copying the model of some other countries. Other countries have also paid out full wages for employees, ensuring that related expenses are covered up to a certain degree, for instance, 75% for those companies which revenue had fallen from the previous year. There are various models of what can be done, but we have not even done the simplest things,” Amon warns.

She suggests that the state should stop asking for the advance payment of profit tax. “Many companies, which did well last year, have paid their taxes and now they have to pay that tax in advance, despite generating little or no profit,” she adds.

The way to help businesses is certainly not to introduce new levies right now like the so-called eco-tax which is 20,000 dinars. According to Amon, the funds collected from that tax are not used for the intended purpose.

(Nova, 06.12.2020)


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