BRATISLAVA, October 10, (WEBNOVINY) — Employers have suggested a reduction of social and health insurance contributions paid by employees in the planned tax and payroll levies reform. Instead of the Cabinet-suggested 19 percent, they want employees to pay 18 percent. “One point reduction is the minimum we can imagine,” announced Vice Presidents of the National Association of Employers (RUZ) Jozef Spirko at a press briefing on Monday.
Representatives of employers believe that a reduction in social and health insurance contributions by one percentage point would increase net income of employees by almost 2 percent. Representatives of Slovak Chamber of Commerce and Industry (SOPK), the National Association of Employers (RUZ), the Federation of Employers‘ Associations of the Slovak Republic (AZZZ) as well as the Club 500 have also presented the possible measures that should cover the deficit in public finances after reduction in payroll levies expected to reach EUR 190 million.
One of the measures that employers have also suggested is the setting the first and second pension pillar contributions rates in 50:50 proportion, which should bring EUR 50 million. They have also suggested cancellation of a deductible item for contract agents which should bring EUR 60 million to public finances. Limitation of the tax-free part of the tax base for a non-working spouse should bring another EUR 30 million.
Legislators voted to move the legislative blueprint related to the revision to the income from gainful activity that is to implement tax and payroll levy reform as of next year to the second reading. Deputies should give the reform a final nod at the upcoming October session. As of next year, the super-gross wage is to become the calculation base for taxes and health and social insurance contributions. The super-gross wage will be the employee’s gross wage increased by payroll contributions paid by the employer, except for accident insurance contributions. The changes will bring about one health insurance and one social insurance contribution and a uniform calculation base for taxes and health and social insurance contributions.
SITA