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Wage subsidy confusion

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Wage subsidy confusion

BURS insist funds have not dried up

Botswana Unified Revenue Services (BURS) has denied reports that it has stopped paying out wage subsidies due to a shortage of funds.

This came after some businesses claimed BURS has not paid out the May subsidy amid allegations the subsidy funds have dried up.

Dispelling such rumors, BURS General Manager-Communications, Mable Bolele, maintained, “All businesses who presented their wage subsidy claim forms to BURS, with the correct information as outlined in the guidelines and as published in all forms of media, were paid.”

She further insisted this includes for the month of May.

Bolele explained that some companies did not receive payments on time because they had presented incorrect details.

“These companies were advised to get in touch with BURS,” she added.

Bolele strenuously denied that the subsidy cash has run dry, adding that the government has committed to three months’ payments for the subsidy and continues to do so without any doubt.

“The money for payment of wage subsidy claims is from the government, not BURS. We are, however, administering payment on behalf of our parent ministry – Ministry of Finance and Economic Development. So far, the government has paid out over P400 million,” she revealed.

The wage subsidy was introduced by the government to cushion companies from the Covid-19 effects and was meant to cover three months of staff salaries for businesses affected by the pandemic.

However, after the first payment, numerous companies claim they were told there is no money to continue with the scheme, leaving them struggling to pay staff salaries.

Businesses said after receiving the subsidy for the first month of lockdown, which was April, they received nothing for the month of May and do not expect to receive anything for June as they have been told there is no money.

“We have long submitted our claims for May, and BURS just acknowledged receiving the application. Even today they haven’t got back to us, it is surprising because in the first month we did not encounter any problem in getting the subsidy,” said one local company representative who preferred anonymity.

In a bid to ensure that only companies that have been tax compliant benefit from the scheme, the government gave the task to administer the subsidy to BURS.

The subsidy was financed from the Covid-19 Relief Fund, which was set up by the government with an initial seed capital of P2 billion. The guidelines stipulated all business sectors are eligible for the subsidy, with exception to those in the water supply, electricity supply, central government, parastatals, banks, pension funds, Botswana Stock Exchange, and insurance among others.

Furthermore, employers in the identified sectors had to be registered tax-payers with BURS.

An Economic Recovery and Transformational Plan (ERTP) prepared by the Ministry of Finance and Economic Development has revealed that the private sector, individuals, development partners, and civil society organizations contributed an additional P110 million to the fund.

According to the report, money from this Fund was mainly used to finance wage subsidies, additional health spending, and food parcels distributed to affected households during the lockdown.

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