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The 5 scenarios for the projected increase of the contributions

By Dimitris Katsaganis

Five scenarios have fallen on the table of competent officials of the Ministry of Labor in relation to the projected increase in the contributions of the self-employed in 2023.

According to his secure information Capital.gr from sources with knowledge of the primary thoughts that have been born in a portion of competent government officials, in addition to increasing the contributions of the self-employed in 2023 by the rate of inflation in 2022 (as provided by the Vroutsi law), is the freezing of contributions, the increase at a rate corresponding to 1/2 of the projected increase in the consumer price index, their increase at a rate of increase in the minimum wage in 2022 or even at a rate of increase in labor costs in 2022.

It is reminded that based on the insurance law of Mr. Giannis Vroutsis in 2023 and 2024 all the contributions of the self-employed (self-employed, self-employed, farmers), ie the contributions not only for the supplementary insurance, but also for the main and health increase in the rate of inflation of the previous year.

Specifically, the relevant provision stipulates that the amounts of the insurance categories “are increased annually by a certificate of the Minister of Labor and Social Affairs, at the rate of change of the average annual general consumer price index of the previous year”.

So if the official forecasts for inflation of 5% -6% this year are verified, then – if the Vroutsi law is implemented – the contributions of the self-employed should increase by a corresponding percentage. As this is foreseen by the existing institutional framework, the application of this increase (s.s. 5% -6%) to the contributions of the self-employed is the first scenario, although not the prevailing one.

Such a burden from 1 January 2023 on the self-employed, after another difficult year – like this year – due to the worsening of the energy crisis brought by the war in Ukraine (and after 2 years of restrictive measures), has raised concerns in many high-ranking government officials and the Funds in relation to the implementation of a 5% -6% increase, although the main line, according to competent circles of the same Ministry, is that “it is still too early to answer” any question about alternatives to such an increase.

Moreover, other sources note, it is still too early for a final estimate of inflation in 2022, along with the definition of policy on this issue.

However, some officials of the government and the Funds have already started to have “second thoughts”, which according to valid information of the Capital.gr predict that there will not be an increase in contributions equal to inflation (5% -6%), but that there will be an increase in the contributions of the self-employed in 2023 to ½ of 2022 inflation.

That is, if, for example, we have 6% inflation this year, a 3% increase should be applied to the contributions of the self-employed in 2023. This is the second scenario.

The same sources, however, consider it equally possible (with the reduction of the projected increase to ½) that there will be a temporary “freeze” of any increase in the contributions of the self-employed in 2023. This is the third scenario.

Other executives, however, expressed in Capital.gr a completely different perception, according to which the existing institutional framework for adjusting the contributions of the self-employed should be radically changed.

In particular, according to the same sources, their contributions should not be determined on the basis of inflation, but on the basis of labor wages. They could be determined based on the evolution of the minimum wage. In this case, given that the minimum wage increased by 9.5% in 2022 (2% in January and 7.5% in May 2022), the contributions of the self-employed could increase accordingly. This is the fourth scenario.

There is, however, a fifth scenario that is expected to fall on the table in the government camp (on the line of increasing the contributions of the self-employed taking into account the course of labor wages) and predicts the increase of contributions by the rate of increase of Labor Costs in the economy and not by the rate of increase of the consumer wage index as provided by the Vroutsi law from 2025 (as this index is not quite “reliable”, according to the same sources). The same sources claim that the growth rate of this index may be greater than 9.5% this year. It is recalled that the Vroutsi law stipulates that from 2025, the contributions of the self-employed will increase by the rate of increase of the wage index.

Source: Capital

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