Insider Economy Higher social contributions burden both employees and employers

Higher social contributions burden both employees and employers

The burden for both employers and employees in Cyprus is getting bigger and bigger these days with higher contributions to the Social Security Fund on the one hand. And, on the other, the gradual contribution to the island’s recently implemented General Health Scheme (Gesy).

Employee and employer contributions to the Fund increased from 7.8% to 8.3% since January 1, 2019. At the same time, the gradual rise in contributions to Gesy means additional costs to both the disposable income of employees as well as to the businesses that have hired them.

Specifically, as of March 1, 2019, employers contribute 1.85% to earnings of an employee who also contributes 1.7%. As of March 1, 2020, employees’ contributions to Gesy will reach 2.65% and 2.9% for employers.

Insider, along with EY Cyprus Tax Adviser Herodotos Hadjipavlou, have studies these changes and concluded that the overall additional cost for a company employing 100 employees with 12 monthly salaries of 1,200 euros and another 100 employees with salaries of 2,200 reaches €469,200.

In addition, with the increase in the Fund’s contribution for employers from 7.8% to 8.3% along with fixed contribution rates such as the Social Cohesion Fund and Surplus Fund, the total cost to the employer rises by €489,600.

In addition, with the implementation of the first phase of Gesy the cost for this business amounts to €552,500, and with the implementation of its second phase this gets higher, gradually reaching €607,920 per year from 2021 onward.

 

Read more:

https://in-cyprus.com/med7-push-for-social-rights-climate-change-migration-in-valletta-declaration/

 

 

 

Top Stories

91 new cases of COVID-19 on Monday

The Health Ministry announced 91 new COVID-19 cases on 26 October, out of 2,285 laboratory tests, taking confirmed infections to 3,636. The break-down of new...

Bottled water withdrawn from Cyprus market

The Health Ministry is informing consumers that within the framework of the officials tests conducted in the market, the Ministry’s health services have tested...

President: Attack against Macron insults European values

In a written statement, President Anastasiades said that this attack, against the French President from the leader of a country which is candidate for...

Finance Minister: No lockdown forseen in 2021 state budget

Minister of Finance Constantinos Petrides called on MPs to approve the 2021 state budget given the critical moments facing Cyprus due to the coronavirus...

Mitsotakis-Anastasiades have working lunch

Prime Minister Kyriakos Mitsotakis on Monday had a working lunch with Cyprus President Nicos Anastasiades. According to government sources, during the lunch they discussed Turkey's...

Taste

Squash soup

Ingredients: 1 kg pumpkin, cut into small cubes, approximately 5 cups 2 medium (400g) sweet potatoes, cut into cubes, approximately 2 ½ cups 1 chopped leek, only...

Mezedes

No visit to Cyprus is complete without enjoying the traditional meal of many small dishes known as ‘meze’. This large feast, which has been a...

Prawns with fried cheese, barley shaped pasta

Put the barley shaped pasta into a small pan with salted water, bring to a boil and when tender, drain. Peal the prawns leaving...

Salmon and shrimp sheftalies

Mix all ingredients for tabbouli in a bowl and keep to one side so flavours can combine. Prepare the sheftalies: wash and soak the casing...