BRATISLAVA, March 19, (WEBNOVINY)- The objective of the reform of the payroll levy system is not to collect more money, said Finance Ministry State Secretary Branislav Durajka on Slovak Radio on Saturday. This reform is aimed at transparency, simplicity and justice, he added. Within the reform the same amount of finances should be collected next year as this year and in the following years the share of payroll levies and taxes on the GDP should even fall. According to him, the total burden of tax and payroll levies will even shrink modestly.
The state secretary, however presented figures according to which a a self-employed person pays EUR 1,700 annually in taxes and payroll levies to the state while an employee contributes EUR 5,300 on an annual basis in these items. „It is such enormous and striking disproportion that it is simply unjust,” he said. In contrast, Durajka admitted that the self-employed draw considerably less from some items of the system. The state secretary concluded that the incumbent system is non-transparent and complicated, which is the reason that some groups currently pay relatively lower amounts compared with others and some pay more. Durajka underscored that the aim of the reform is to equalize the payments so that those who currently pay little money will pay somewhat more ad those who pay relatively more, will pay a little bit less.
Durajka underscored several times that no increase in rates is under preparation. According to him, new rules should introduce a single social insurance payment at 19 percent and at 16 percent in case of self-proprietors, in order to reflect the fact that they are not entitled to some benefits. The health insurance contribution rate should be 9 percent.
Former state secretary of the Finance Ministry Peter Kazimir (SMER-SD) says that it would be unpardonable if two problems are not taken into consideration in the reform of payroll levies – sustaining the state of public finances; i..e. the deficit and solution of the high unemployment. He however is concerned that in the proposal the Finance Ministry is coming with at the moment these two factors are not resolved. Kazimir considers it insanity if the reward for self-employed persons and people with contract for work whose living standard will remarkably drop is to be a simpler and more transparent system given the current growth in costs.
SITA