Warsaw, 27th October 2020
ANTI-CRISIS SHIELD: INDUSTRY POSTULATES
IN ADDITION TO PROTECTING JOBS, QUICK AID IS NECESSARY FOR INDUSTRIES AT RISK
The Union of Entrepreneurs and Employers prepared and presented last week the concept of a PLN 100 billion shield for employment, which is a response to the economic challenges related to the development of the coronavirus epidemic in Poland. However, we are aware of the fact that apart from a comprehensive programme aimed at protecting jobs in the economy, regulatory support is also needed, targeted at industries threatened by the epidemic. One should remember that the difficulties related to the development of the epidemic are not limited only to the financial losses resulting from bans or restrictions to business operations. Hundreds of thousands of people who are quarantined and subjected to epidemiological supervision are also employees, and the mode of providing some services, due to the need to introduce special sanitary standards, has changed dramatically.
The necessity to launch aid is unquestionable. At the same time, the epidemic and the crisis it causes will result in structural changes to the economy – these factors must be taken into account when designing any kind of intervention programme. Their goal cannot be to keep companies unable to adapt to the new reality afloat, but rather to support and help those entities that make an effort to survive. Thus, it is possible that the above-mentioned changes in the structure of the economy eventually will, despite temporary perturbations, increase productivity due to a better use of available resources.
THE AID ACT MAY PROVE INSUFFICIENT
The parliament has already received a parliamentary draft act introducing an aid package for industries particularly affected by the second wave of the epidemic. It seems that the basic assumptions of the act coincide with the approach described above – aid is targeted at industries in the worst situation and it is at the moment de facto minimal, i.e. making it easier for companies to survive a difficult time. Therefore, we get the impression that the government is proceeding cautiously in grading the aid – in the first place, it is proposed to introduce a standstill salary and exemption from social security contributions for several listed industries, as well as to extend the validity of the solutions provided for in the previous anti-crisis shields.
The approach adopted in the above scope seems reasonable (we will publish a separate position with regard to the presented draft law). However, one cannot rule out that the prolonged epidemic crisis will necessitate the launch of further actions. With this in mind, we consulted with trade unions associated within the Union of Entrepreneurs and Employers.
Below we have listed a set of recommendations presented by individual industries. For the sake of clarity of the document, we divided thsee recommendations into general and detailed ones, the latter in turn for individual industries. We hope that the recommendations presented will prove useful when working on the next stages of help for industries.
- The key assumptions of the PLN 100 billion shield for employment presented by us are valid;
- There is a need for automatic exemption from social security contributions (and provision of standstill benefits for employees) for all industries subject to restrictions going beyond DDM;
- The introduction of any restrictions on economic activities should be allowed only on the basis of rational, evidence-based argumentation;
- We maintain the necessity to launch liquidity tools differentiated depending on the situation: for companies subject to the restrictions beyond DDM, a working capital loan in the amount of up to 10% of the turnover for the previous year; for entrepreneurs whose turnover has decreased year-on-year by at least 25%, a partially repayable subsidy or a 100% long-term repayable loan;
- Moreover, it is necessary to introduce a number of general simplifications as listed below:
- elimination of barriers to the employment of foreign nationals, including, in particular, the acceleration of procedures for issuing work permits;
- withdrawal from new taxes and administrative obligations (a moratorium of at least 12 months on all kinds of additional burdens, such as the sugar tax or “the rain tax”);
- making labour law more flexible so that its provisions take into account numerous absences resulting from infections or quarantine, including in the scope of abolishing the limit of overtime;
- enabling self-regulation by appointing COVID-19 coordinators in the form of, for example, people responsible for health and safety in companies – they could become contact persons for Poviat Sanitary Inspectorates;
- the introduction of a mechanism for reimbursing employers for the costs of coronavirus tests carried out among employees in the form of deduction of these amounts from contributions to the State Fund for Rehabilitation of Disabled People or the Social Insurance Institution, PFRON and ZUS respectively;
- postponing the possibility of settling the loss in income tax for another year;
- considering the possibility of renegotiating contracts concluded with entrepreneurs by the Polish Development Fund as part of the support granted from the financial shield – companies with a significant decrease in revenues should be able to postpone the repayment of liabilities towards the Fund by one year;
- considering the possibility of launching targeted financial support for the adaptation of companies to functioning in the reality of an epidemic (micro-loans for retrofitting equipment for remote work or changing the model of service provision);
- making financial aid dependent not only on the industry, but also on the decline in turnover (the postulate is consistent with the programme of financial support for companies presented in the “PLN 100 billion shield for employment”).
FOOD CATERING INDUSTRY
- Introducing a temporarily uniform rate of 5% VAT on all catering services – including the sale of non-alcoholic and low-alcoholic beverages (beer, wine, ciders) and with the prospect of setting a uniform rate of 8% after the pandemic;
- Introducing the possibility of distance sales of low-alcohol beverages and enabling takeaway sales of low-alcohol beverages to premises with a licence to sell alcohol on premises;
- General temporary exemption from social security contributions for entrepreneurs in the catering sector and their employees;
- Introduction of a publicly funded “standstill” for employees from the catering sector (specific standstill regulations for employees particularly at risk of severe coronavirus infection, i.e. seniors or disabled people, to be considered).
WASTE MANAGEMENT INDUSTRY
- Introduction of the possibility of directing the waste stream to other installations operated by the same entity in the event of the necessity to shut down or limit the operations of an installation due to COVID-19, provided it is technically and organisationally possible and provided that environmental protection standards are met;
- Enabling changes in the system or schedule of employees’ working time and ordering to work overtime, to be ready to work and to exercise the right to rest in a designated place;
- Amendments to §11 sections 1-4 of the Regulation of the Minister of Climate of 11th September 2020 on detailed requirements for the storage of waste in the scope of storage of infectious medical waste and infectious veterinary waste as part of waste collection, including in terms of enabling the storage of collected medical waste or infectious veterinary waste in specialised refrigerated containers or refrigerated trailers, characterised by parameters ensuring compliance with all rigors and requirements related to waste collection, or in the scope of extending the storage periods for infectious medical or veterinary waste at specific temperatures;
- Restoration of solutions known from the first anti-crisis shield, granting voivodes special powers in the field of administration over waste management systems.
- Amendments to the draft act on the profession of pharmacist with regard to:
- amendment of the provision enabling the withdrawal of a licence to operate a pharmacy in the event of a breach of the pharmacist’s professional independence so that this sanction can be applied in the event of persistent or gross violations,
- deletion of the provision enabling the “immobilization” of a pharmacy, pharmacy outlet or pharmaceutical wholesaler in the event of “preventing the performance of tasks” by the pharmacy manager or the person responsible at the wholesaler,
- deletion of the provision on the role of the pharmacy self-government in assessing the warranty of a candidate for a pharmacy manager,
- deletion of the obligation to run a pharmacy or pharmacy outlet in a specific legal form from the catalogue of a pharmacist’s professional tasks,
- amendment to the scope of powers of a pharmacy manager so that it covers only substantive tasks, not strictly related to running a business and being the responsibility of the pharmacy owner,
- opening a catalogue of healthcare services provided by generally accessible pharmacies.
- Maintaining the current mechanism of calculating the excise duty on beer and keeping the excise duty rate unchanged;
- Enabling (permanent) deduction of excise duty on beers past best before date (solution compliant with EU law and applied in several member states; in Poland, only a temporary option to deduct excise duty on beers after expiration date has been introduced);
- Revision of the Act on excise duty and of the Tax Ordinance through in particular:
- clarification that excise permits are not revoked in the event that a taxpayer submits a collateral for the implementation of decisions resulting in tax arrears,
- clarification of the rules for submitting collateral for the enforcement of tax decisions at the taxpayer’s request, also before issuing such decisions, and withholding secured decisions,
- allowing the possibility of issuing certificates of non-arrears in taxes in the event that the taxpayer submits a collateral for the implementation of tax decisions,
- permitting the authorities to suspend the proceedings in the event that the outcome of the case could be influenced by the outcome of another ongoing administrative, court-and-administrative or court proceedings.
- Introducing the priority for coronavirus testing of critical workers involved in the manufacture and distribution of drugs;
- Taking into account the specificity of the pharmaceutical sector in the course of works on the amendment to the act on the national cybersecurity system, both in terms of respecting the security systems built by the entities and the risk of an excessive narrowing of the possible catalogue of automation and industrial electronics manufacturers, whose products are used in drug production lines;
- Introduction of a support system for domestic drug producers under the Reimbursement Mode of Development.
- Unifying the practices of state authorities, including, in particular, sanitary inspections related to production safety;
- Enabling companies from the food industry, due to their special role in the economy, to use the inventory of personal protective equipment accumulated by the Material Reserves Agency in the event of problems with the purchase of these products on the market;
- Increasing the amount of exemption for cards and meal vouchers for employees from the Social Insurance Institution to 25% of the minimum wage;
- Creation of “corridors” at border crossings for employees of food industry facilities, as well as drivers carrying food products and loads necessary to maintain the continuity of food production, with special priority of passage for raw materials and perishable foods;
- In the event of significant difficulties in accessing logistics and transport services, priority should also be given to the entire food production and distribution chain, also within the framework of domestic traffic;
- Abolishing the Sunday trade ban;
- Withdrawal from the ban on breeding fur animals and the ban on ritual slaughter;
- Amendment to the provisions of the regulation on the restrictions related to the introduction of the state of the epidemic in the scope of clearly indicating that the restrictions on the number and age of people present on the premises of a retail outlet do not apply to people serving stores, including sales representatives of suppliers;
- Providing the sectors of food producers and processors the status of an element of critical infrastructure along with their entire supply chain, so that they are not subject to any bans or restrictions on transport, access to electricity or water.
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