One of the most common schemes is that a company manipulates its revenue by painting it larger in retrospect. For example, the VAT return of March last year is taken and the sales revenue is increased by a third. The idea is that this way, the company fits under the support of the Unemployment Insurance Fund, one of the main criteria of which is that the company’s revenue must have fallen by at least 30 percent in a year.
Another way is to manipulate with employees’ salaries. Usually, companies increase their wages in retrospect in order to start reducing it in the event of a crisis. In this way, they can meet the second criterion – the employee’s salary must be reduced by at least 30 percent in order to qualify for support.
Airi Jansen-Uueda, risk manager at the Tax and Customs Board, told Postimees that since March 19, more than 1,700 companies have retrospectively amended their VAT and labor tax returns for last year. However, this does not mean that they are all trying to scam the state. The declarations are adjusted retrospectively throughout the year, and there is nothing strange about that. Thus, according to Jansen-Uueda, each case should be considered separately, and only then can it be said whether or not there was fraud. This is what the Tax and Customs Board is helping the Unemployment Insurance Fund do. However, she did not wish to disclose the background in greater detail to Postimees.
The third most common way to deceive the state is for beneficiaries not to pay taxes. It is important to emphasize that although the Unemployment Insurance Fund reimburses 70 percent of the salary of a worker in difficulties, the employer must also shoulder at least 150 euros, on which all taxes must be paid. It can also be seen that the members of the company’s management board retrospectively register themselves as ordinary workers in order to receive benefits, but they do not pay the unemployment insurance premium.
The last and perhaps most impudent scheme is where a company sets up the employee to save their own skin. For example, there have been cases where the employer applies to the Unemployment Insurance Fund but enters the company’s own account number instead of the employee’s current account. Alternatively, the company enters into a written or oral agreement with the employee for the latter to repay part of the benefit to the employer.
“There have also been hints that an employee has been threatened with redundancy if they do not sign the necessary document,” Lauri Kool, head of communications at the Unemployment Insurance Fund, told Postimees.
This way, support intended primarily to help the employee ends up in the company’s pocket.
Large companies believe that scammers should be made public and punished. A few days ago, Arto Aas, manager of the Estonian Employers’ Confederation, Toomas Luman, chairman of the Estonian Chamber of Commerce and Industry, and Vaino Kaldoja, chairman of the management board of the Estonian Business Association, sent five proposals to the government on how the state should boost the economy and private entrepreneurship during the crisis.
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