The Government is “very close” in reaching an “agreement of principle” with self-employed to implement the new contributions system that is based on real income. The president of ATA Lorenzo Amor made this announcement Monday. This is the group that has been the most critical of the text’s implementation. Sources from the Department of Social Security confirm that the agreement in principle will be announced within the “next few days”. The Royal Decree to Implement the New Scheme was approved by the Council of Ministers this Monday. It is intended to fulfill the milestone that was agreed with Brussels in the first half of 2022. However, it only states that the quotations may be modified up to six more times to adapt them to their yields and leaves the quotas open while they wait for the agreement to come into effect.
It was not an easy road to reach this foreseeable close consensus. Jose Luis Escriva, the minister, had to make a series of concessions to satisfy most people, including employers. However, before the employer gives its definitive yes, it wants to set the application calendar with the goal that the quota increases be progressive.
The Executive presented a new proposal at yesterday’s meeting. It proposes that contributions from the over 3.3 million self-employed be established for three years instead of nine. These fees will be based on net income (not from other activities) and range from 230 to 590 euros. It also pledges to increase the maximum contribution base for people over 47, which is another requirement of CEOE.
“At the moment, we are very close, much closer than the last week but it is caught with pins,” said Amor. He delayed definitive support until they saw “the horizons 2023, 2024 Sections and 2025>> as well as the final text. They highlighted the “significant progress” made by the Ministry of Social Security at the meeting.
This newspaper exclusively reported that the latest Government proposal increases the contribution brackets from 15 based upon the net income of self-employed activity. It also includes a bracket for people who earn more than 6,000 euro per month. This was a request by ATA to reduce the fee for those earning less. Similar to Escriva, Escriva agreed to the UATAE and UPTAE demands to reduce the contribution of those earning less. This means that almost everyone benefits from the new approach, with the exception of those with very high incomes.
The lowest monthly fee for people earning less than 670 euro is now 230 euros. This is 15 euros less than the old one and far below the current 294. According to Eduardo Abad (president of UPTA), this will result in a 767 euro per year reduction for self-employed workers. He stated that the proposal “satisfies expectations.”
All those with returns below 1,300 euro per month (about 2.25 million) will see their prices rise, while those earning between 1,300 to 1,700 euros will maintain them. Contributions will increase based on these incomes. However, everyone will pay slightly less than the previous proposal. The exception is those above 6,000 euro who will have to pay 2,546 Euros more per year than the minimum quota these workers have today.
