Romanian Govt: Employers To Withhold, Pay Social Contributions For Copyright Income

He also said the new procedures will be applied starting Monday, September 13.

According to Botis, social security contributions will not be paid for employees who are constantly paid salaries and gain income from copyright occasionally.

Also, social security contributions will be limited to five average gross salaries per year for people with no employment contract and who exclusively gain occasional income from copyright.

Botis also said that employees who are paid salaries and also gain income from copyright, on a regular basis, will pay social security contributions for the extra income, which will also be limited to five monthly average gross salaries.

The draft emergency ordinance presented Tuesday by MEDIAFAX stipulates that companies will be obliged to submit monthly, until the 25th of the month following that in which the income for freelance activities was paid, a statement regarding the nominal registration of people who gain income from freelance activities, other than salary income.

The ordinance also says that companies are obliged to declare, calculate, withhold and pay individual social contributions only for pension and unemployment insurance, not for health insurance, which equals a total contribution of 11% of the calculation base, compared to the current 16.5%.

Another draft act amending the Tax Code, which is up for public debate, says people who gain income from freelance activities will pay, starting with 2011, social security contributions of at least 25.36% and up to 35% of their income, nearly double from the current level of contributions. Under current law, they pay social security contributions in the amount of 16.5% of their income.

According to the draft, the pension insurance contribution is to increase to 24.43% from 10%, the health insurance contribution is to increase to 8.35% from 5%, while the contribution to the unemployment aid fund is to increase to 0.78% from 0.5%.

Prime Minister Emil Boc said earlier Wednesday that the Executive is not in favor of doubling social security contributions for people who gain income from copyright and asked Finance Minister Gheorghe Ialomitianu to consider this aspect. Boc said the draft act increasing social security contributions for people who also gain copyright income was not discussed in the Government. He added, however, that this act also brings good measures, among which, the unification of the calculation base for social security contributions.

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