Requirement to qualify for wage subsidy bared

April 17, 2020

Workers of tax compliant-small businesses who would not receive salaries for at least two weeks because of the quarantine implemented to arrest further rise of coronavirus disease 2019  are qualified for the wage subsidy program.

This was disclosed by Finance  Assistant Sec. Antonio Joselito Lambino II.

Lambino said the workers who are qualified for the wage subsidy are those who would not receive salaries for a minimum of two weeks because they were not able to work either as their companies have temporarily stopped operations, or have implemented skeletal force in line with the government’s Covid-19 response.

He said small companies would now be burdened by lost opportunities to operate during the quarantine period, and would find it hard to pay their workers.

The Department of Finance earlier said it would extend the wage subsidy to 3.4 million workers of small businesses but the priority would  be given to those who are employed by companies that pay their obligations to the Bureau of Internal Revenue and the Social Security System.

Under this program, the government is allocating P51 billion as wage subsidy.

Lambino said owners of small businesses would also get some support from the government through, among others, the grace period for payment of loans and rents.

He said the government is prepared to implement its Covid-19 response, citing they have prepared a program that would  be implemented until May, way later than the initial deadline of the enhanced community quarantine for Luzon of April 12.

Lambino said the government is still ahead of the “curve” even if the ECQ in Luzon alone was extended to April 30.

“The Duterte administration planned for a longer (support program than that of the ECQ) so that we can adequately prepare,” he added.

During the same briefing, BIR Deputy Commissioner Arnel Guballa said the wage subsidy program is meant for employees of small companies that have paid their withholding taxes for the last three years.

He said tax exemptions are also given to companies that have donated or would donate for programs under the Bayanihan to Heal as One Act.

These donations include personal protective equipment and other medical supplies needed for the fight against the global pandemic.

He said the government has also shortened the process of bringing out from the Bureau of Customs warehouses imported items that would be donated to health workers and this importation would also not be slapped with taxes.

Aside from these exemptions, Guballa said the Bureau has also extended the filing of the income tax return from April 15 to May 15, then further to May 30, on account of the extension of the ECQ period.

BIR has also issued Revenue Regulation 10-2020 that lists the extension of deadline for the payments and submission of necessarily documents and taxes, such as the value added tax  refund, sworn statement on manufacturer’s or importer’s volume of sales of each particular brand of alcohol, tobacco products, and sweetened beverage products, and registration of computerized books of accounts and other accounting records in electronic format.