Sinn Féin spokesperson on Finance Pearse Doherty TD has criticised the Minister for Finance for retrospectively taxing workers who received the Pandemic Unemployment Payment.
A new section of the Finance Bill was passed at the Oireachtas Finance Committee on Monday to clarify that the Pandemic Unemployment Payment is subject to income tax.
It was first introduced as an “urgent needs payment” that is explicitly exempt from tax under the Taxes Consolidation Act 1997. All payments under the scheme made between April and August will now be taxed, with recipients facing potential bills of up to €1,470.
Teachta Doherty said: “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.”