Government to finally cut contributions

The government’s recent announcement on the upcoming reduction of social security contributions constitutes a direct admission that the law introduced by former social security minister Giorgos Katrougalos has since 2016 served as a mechanism for confiscating up to 70 percent of the incomes of thousands of self-employed professional, mainly lawyers, engineers and doctors, say sector representatives.

“Over 200,000 freelancers have had to close their books [with 1.5 billion euros less being declared as income to the tax authorities in the process] since the Katrougalos law was voted for the government to decide to reduce the social security contribution rates,” noted the president of the Economic Chamber of Greece, Constantinos Kollias.

Despite the government’s delayed reaction, self-employed professionals who pay contributions not only toward their main pension but also their auxiliary one and their retirement lump sum are set for a significant easing of the load on them.

However, the reduction of contributions for auxiliary pensions and lump sums to 64.5 euros per month will also lead to a drop in the amounts they receive when they retire. Experts expect that future auxiliary pensions for these professionals will drop to just 30 euros per month, while retirement lump sums will also be slashed.