Countdown to a new reduction in the non-salary costs of businesses

Of Dimitris Katsagani

The government is preparing another reduction in non-salary costs. According to valid information of Capital.gr on the table is a 0.6% reduction in the insurance contributions of employees, which will in fact take effect from January 1, 2022.

In fact, the same sources state that the intervention will probably be in the package of announcements from the upcoming TIF.

If the above scenario is verified, it will be the 4th reduction in contributions since June 2020 and will fulfill the government’s programmatic commitment to reduce contributions by 5 points in the period 2020-2023.

It was preceded by the reduction of OAED contributions by 0.9% in June 2020, again by the reduction of OAED contributions by 3% in January 2021, but also by the reduction of auxiliary contributions by 0.5% in June 2022 .

Thus, in the period 2020 – 2022, the insurance burden of businesses has fallen from 40.5%, which was in May 2020, to 36.1%.

If the scenario of a further reduction in contributions (by 0.6%) in January 2023 is verified, then this will fall to 35.5%. That is, it will have decreased by almost 1/6 compared to 2020.

Regarding the field of contributions on which the 0.6% reduction will be made, the same sources rule out that it concerns the main insurance, the auxiliary (i.e. more generally than the e-EFKA) and health (EOPYY).

And this, both the main and auxiliary insurance, as well as health, had and still have increased obligations and have no room for revenue reduction.

With regard to the main – auxiliary insurance, the plan to eliminate overdue pension applications is in progress (until August for the main ones from a fund and consecutive insurance and then parallel and auxiliary insurance), while at the end of the year there will be increases of 5%-6 %. But EOPYY is still burdened with increased costs due to the pandemic.

Thus, the “indicator” of the reduction of contributions looks again at the OAED, which does not seem to be burdened with increased obligations, as the reduction of unemployment brings a reduction of the beneficiaries of unemployment benefits, while the recovery fund and the new NSRF will cover a large part of training costs.