The government, social representatives and self-employed associations ATA, UPTA and Uatae yesterday finalized an agreement on the first phase of the implementation of a new social security contribution system for this group, which is expected to start paying your contributions based on your net return, rather than choose your contribution basis, from 2023 onwards be able. The executive yesterday made a new proposal which the various parties involved say has brought the final agreement closer. Said proposal includes a new system with 15 income brackets, which, according to the Ministry of Inclusion, Social Security and Migration, led by José Luis Escrivá, would mean paying between 230 and 590 euros per month. Although these amounts are the ones that would be paid from 2025, for which some associations such as ATA and UPTA have indicated that before the final yes to the agreement, how these sections should be implemented in 2023 and 2024 should be concluded.
If this latest government proposal goes through, self-employed people with net incomes of up to €1,300 a month would pay less to Social Security than they currently do (the minimum contribution is now €294 a month). Specifically, those with a net return of less than $670 would reduce their monthly fee by $64 and pay $230 per month, representing an annual savings of $767. If you start between 670 and 900 euros, the fee would be 250 (-44 euros per month compared to today). Finally, the other groups that pay less are those who earn between 900 and 1,125.90 and between 1,125.90 and 1,300 euros per month, with lower fees of 24 and 4 euros per month respectively.
For their part, those who have a net return of between 1,300 and 1,700 euros per month continue to pay the same fee that most of them currently pay (294 euros per month), while the fee increases from these earnings to 56 and 236 euros more im Month. Accordingly, the maximum assessment base of the group is set at 1,928.10 euros for those who have a net income of 6,000 euros or more per month. This means they pay a monthly fee of 590 euros, which is 2,546 euros more per year than the minimum fee these workers can currently pay.
This proposal is in line with the expectations of the UPTA association, led by Eduardo Abad, which has already announced that it will accept it as long as the self-employed with lower incomes and lower fees can benefit from it from January 2023, while medium and high returns are also expanding be able to adjust flexibly to the new contributions, which for most of them will be higher than the current ones, over a longer period of time.
UPTA wants to pay the lowest fees of 230 euros as early as 2023
If the implementation model discussed in the last meetings is maintained, this system would be implemented in a first phase from 2023 to 2025 inclusive, to be evaluated later and to decide whether to keep it or to change it. “Right now we’re very close to a pre-agreement, but it’s being pinned. By the time we see the horizons of the sections for 2023, 2024, 2025, and the final text, threads are all woven together. At the moment we are much closer to reaching a pre-agreement than last week,” Amor said yesterday.
From the start, this association was one of the most critical of the government’s proposals; in fact, it was the one who initiated the gradual implementation of the sectional system over nine years and proposed an interim system for three years that seemed to have been accepted by all parties.
ATA is asking to continue with the flat rate and to cancel the base for people over 47 years of age
“We don’t want to rush the bells until we see the horizon of sections to 2025 and what was fundamental for us: that the flat rate for new self-employed registrations had to be maintained without any restrictions, that with the uncovering of the basis for those over 47 had to be started and that the net returns were net returns from the activity carried out by the self-employed and not from other aspects. We have to see how the wording of the text turns out to see whether we give our approval or not,” added Amor.
Therefore, it is important for these associations to analyze the details of the standard, which has 60 pages; Therefore, agreement has yet to be reached to see if the final wording of the text includes all of these points.
- New regulation. In parallel with these negotiations between the government and the associations of the self-employed to change the group’s social security contribution system, the Executive yesterday reformed several technical issues relating to the recording and reporting of the income of these professionals. To this end, the Council of Ministers yesterday approved a Royal Decree containing the regulatory changes to introduce the new self-employed contribution system in January 2023. This decree includes, among other things, the extension from four to six times a year that the self-employed can change their contribution basis. And consequently, with the new system, they will also change their contributions to paying into social security.
- Report upon dismissal. The Department for Inclusion, Social Security and Migration explained that the royal decree introduces other changes, such as B. that the self-employed give a forecast of the annual income when registering. That is, they must indicate how much they expect to enter into the system in the same application for registration.