The measures taken by the Government during the state of emergency are insufficient. That subsidization by refunding taxes to businesses is a solution that looks well in terms of support for the business community, but the budgetary impact is overestimated. The stimulation of layoffs is one of the effects of the given measures that envision the payment of that unemployment benefit, said participants in a debate staged by the Institute for European Policies and Reforms, IPN reports.

Economist Marcel Spătari, director of Syndex Romania, said the procedure for refunding the taxes from salaries is not yet clear for the State Tax Service and the accountants. On the one hand, the authorities speak about the institution of a moratorium on inspection. On the other hand, the business entities that will benefit from this subsidization will be subject to thematic control. Given that a part of the firms work on the gray market, they do not want and are afraid of inspections. Another aspect is the size of exemptions from which the business entities will benefit. If the costs associated with salaries are taken into account, the impact will not be of over 40% by far, as the authorities announced. The budget planned for paying unemployment benefit should have been used to pay benefit for technological unemployed, directly to salary earners, as they decided in Romania, for example.

Vladislav Caminschi, executive director of the National Employers Confederation, said a part of the employers experience a halt in the economic circuit. Most of them resort to technological unemployment as the measure is less costly, with the employees being paid 50% of the salary. There are two extremes – to keep the salary earner and pay salary to this or to fire this and everyone calculates the impact here. The small enterprises with small profitability cannot keep the employees. The medium-sized enterprises can do it, but not for a long period of time.

The debate titled “Impact of COVID-19 on the Republic of Moldova: How can we ameliorate situation of salary earners in the period of crisis?” was organized by the Institute for European Policies and Reforms with support from the Hanns Seidel Foundation.

Note: The Constitutional Court suspended the law adopted by the Government by assuming responsibility for it bypassing Parliament. The law contains a number of measures to support the citizens and business during the state of emergency. The announcement was made by Prime Minister Ion Chicu in a press briefing.