Thursday, July 7

The Government studies tax advantages for the collective pension plans of the self-employed

Minister José Luis Escrivá, during a press conference.

The Government continues with its idea of ​​launching a new system of funds and pension plans sponsored by the public sector, and prepares special advantages for the self-employed. According to the Draft Law that the Council of Ministers plans to study in the coming weeks, to which EL PERIÓDICO DE ESPAÑA has had access, this group may apply a reduction greater than current Income Tax for their contributions to pension plans, provided they are used for special savings vehicles for the self-employed: up to 4,250 euros per year, compared to the limit of 1,500 euros per year that applies to participants in individual plans.

The future law contemplates –as also advanced by EL PERIÓDICO DE ESPAÑA– The creation of Public Promotion Employment Pension Funds, piloted by the Ministry of Inclusion, to which Simplified Employment Pension Plans, promoted by business sectors, public administrations and “associations of self-employed workers, professional associations and mutual societies linked to them ”. The novelty of the preliminary draft, compared to the initial draft, is that it includes that figure of 4,250 euros per year for the special contribution limit for the self-employed, which is almost three times higher than the individual limit, although it is still half of the amount foreseen for contributions to the plans of employment, of 8,500 euros per year.

All these amounts (the 1,500 and 8,500 euros per year, which appear in the draft General State Budgets for 2022, and the 4,250 euros per year for self-employed workers included in this Draft Bill) will be enshrined in the law that regulates personal income tax if it is finally approved. the legislation under study. The promotion of occupational pension funds and plans is a commitment made with Brussels within the framework of the Recovery, Transformation and Resilience Plan, but its approval is not expected until second quarter of 2022, so there is still time to make changes to the text. In fact, the arrival of the Draft Bill to the Council of Ministers is the first step in the legislative task, which can take months to complete.

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Discontent in unions and employers

The added bonus for freelancers probably won’t eliminate the discontent of the social agents with the entire government plan for pension funds, which they have harshly criticized since the first draft was known in mid-October. UGT and CCOO then issued a joint statement in which they assured that the proposal “involves substantial changes on the regulation of the employment pension funds that we do not share” and the CEOE has been even more severe: in an interview in EL PERIÓDICO DE ESPAÑA , the president of the employer’s association, Antonio Garamendi, qualifies as “unfair competition” and “absurd” the initiative designed by the Ministry of Inclusion.

The Government’s plan is to promote savings for retirement by promoting collective plans but with public supervision, to “guarantee […] lower management costs, allow a diversified investment distribution and, with it, improve profitability levels “, as read in the explanatory memorandum of the Preliminary Project. The aim is to reach groups that do not regularly use these funds, such as public employees “of medium or small local entities”, the self-employed and smaller companies, and thus achieve participation rates similar to those in Europe, which the document figures between 25% and 90% of the active population (in Spain, occupational pension plans now reach “just over ten percent”).

News in commissions

The text of the draft introduces other important changes, in addition to the deductions of the self-employed, with respect to the original document. Unlike that first draft, the Draft does not determine the maximum commissions that may be collected by the managing entities and depositors of the Public Promotion Employment Pension Funds (which were 0.4% and 0.1%, respectively), but refers to the operating rules of each fund, which will set a management commission for each of the plans that comprise them.

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Likewise, the text of the Draft gives more play to other ministries, in addition to Inclusion, in the key piece of the new system: the Promoting and Monitoring Commission of public pension funds. This body, which will urge the creation of new funds and “will ensure the suitability of their development” (with the right of veto included) will be made up of nine career officials: five from the department of José Luis Escrivá, and one from each from Economy, Work, Ecological Transition and Finance.

In addition, the design of the new system, for the sake of “simplification in the categories of existing pension plans”, provides for the absorption of current associated pension plans (Those promoted by associations, unions or unions, instead of by companies) in employment pension plans or, failing that, in individual ones. As of the entry into force of the rule, the associated employment plans will have five years to transform into a plan of one type or another, or continue to operate with the old regulations until their expiration.

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