One in three self-employed will pay almost 1,800 euros more per year with the new reform

One in three self-employed workers will pay an average of 1,798.

Thomas Osborne
Thomas Osborne
14 December 2022 Wednesday 01:33
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One in three self-employed will pay almost 1,800 euros more per year with the new reform

One in three self-employed workers will pay an average of 1,798.1 euros more per year under the reform of the system approved by the Government in 2025. On the other hand, two thirds will save an average of 688 euros per year, according to estimates made by Joan Ramon Rovira and Jaume Martí from the Barcelona Chamber of Commerce in an article published in the Revista Econòmica de Catalunya.

The calculations of the winners (2.1 million workers) and losers (1.0 million workers) with the reform made by the economists are in line with those estimated by the Ministry of Social Security. In absolute value, the estimates made in the article show that the improvement in collection will be around 388.6 million euros.

"The new contribution scheme based on the net performance of the reform does not appreciably improve the budgetary sustainability of the system," reads the academic article. The benefits received by the self-employed are around 20% below those received by members of the general regime, but their contributions are almost 40% lower. "The consequence is a deficit per member of the self-employed regime that more than doubles the general Social Security deficit: 2,294.1 euros per year per self-employed person, compared to 1,009.8 euros per employee. According to the authors' estimates to correct This gap should increase the average contribution of the self-employed by 35.5% (from the current 304.4 euros per month to 411.4).

In number 86 of the Economic Magazine directed by the UPF professor, Guillem López Casasnovas, this time revolves around "The Tax Reform" with several articles that analyze the tax system, including the contribution model for the self-employed.

One of the highlighted issues is how to reduce Spain's tax gap with the EU. "The main path would be to increase indirect taxation", it is highlighted since direct taxation (essentially personal income tax) is already at high levels.

In Spain, tax revenues over GDP in 2019 stood at 34.8% of GDP. They are 5.2 points below the European weighted average. "Of those 5.2 points of difference, 2.0 points came from a lower indirect tax collection; 1.6 points, from a lower income tax collection; 0.9 points, due to the decrease in social contributions, and 0.5 points, of corporate taxation". Javier García Arenas, from CaixaBank Research, points out in an article.

The report specifies that "Spain is the EU-27 economy with the lowest effective rate on consumption": 3.4 percentage points below the European weighted average in 2019.

In the magazine, Jorge Onrubia (UCM-ICEI and FEDEA) analyzes the redistributive role of the tax system: "regarding wealth taxes, including the so-called taxes 'on large fortunes', apart from the discussion about their suitability Due to their efficiency problems regarding savings, it should be noted that these are figures with a redistributive capacity, again, also quite limited". In his opinion, "the main problem with the limited capacity of the Spanish tax system to reduce inequality resides in its low tax collection power."