Austria: introduction of a hiring bonus and a rise in tax-free employee profit sharing

The call for early elections to be held on 15 October has forced the government to adopt several measures before the parliamentary summer recess. Among these is the Beschäftigungsbonus, or hiring bonus that will allow companies to pay only 50% of their new employees’ social contributions for a period of three years. In addition there will also be a law raising the tax-free threshold for companies’ discretionary employee-profit-share schemes. Both measures will come into force on 01 July 2017.
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Two billion euros for the Hiring Bonus. In the week of June 19 Austria’s parliamentary economics committee adopted, albeit without the Ecology Party’s support, the creation of the Hiring Bonus that seeks to ‘strongly encourage hiring’. This bonus will enable companies to hire staff and as a result receive 50% relief on their new employees’ social contributions for a period of three years. The federal government has earmarked €2billion to finance this measure over the period 2017-2023.

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