The congressman, Alexander Cavero Alvabench member Country advances, has presented this October 13 the bill that promotes formal youth employment in Peru. This is intended to promote the job of young professionals who seek to quickly insert themselves into the working market formal for the first time.
To achieve this, the legislative initiative proposes the creation of the special regime ‘My First Chamba’, which establishes a special deduction for tax purposes to natural and legal persons who hire young people between 18 and 29 years of age, who access for the first time to a job.
In this way, individuals and companies that hire young people who access a formal job for the first time and who receive a monthly gross salary less than or equal to S/. 2,000, may deduct as an expense, for income tax purposes, 150% of the fifth category income of said workers. The contract must be for personal work provided in a dependency relationship with the contractor.
Regarding its duration, the bill contemplates that the deduction is only applicable on the remuneration consigned in the payroll until the young person hired reaches 30 years of age or 3 years have elapsed since his hiring, whichever occurs first. This regime, if the project is approved, would enter into force at the beginning of next year.
The legislative initiative seeks to address the increase in youth unemployment, particularly due to the spread of COVID-19 in the country. It is estimated that urban youth without work have increased by almost 200,000 people compared to 2019, while the unemployment rate of young people between 18 and 29 years old represents just over double what is recorded in the case of the elderly 30 years old.
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