Will employees subject to social insurance contributions have to pay almost half of their income in social security contributions in ten years? According to a recent study, this would be an obvious scenario.
Employees and employers are facing sharp increases in social security contributions in the coming years. Even in the best-case scenario, contributions are likely to rise significantly from 2028, according to a study by the Berlin-based IGES Institute. By 2035, contributions in the various insurance sectors could rise by a total of 7.5 points to 48.6 percent.
On behalf of DAK-Gesundheit, the Berlin researchers calculated the development of contributions to pension, health, nursing and unemployment insurance, as it seems obvious from today’s perspective. In doing so, the IGES assumed average values for the factors that determine the contributions – the birth rate, life expectancy, migration and wage development.
In the more favourable scenario, the contribution rate would rise to 45.8 percent by 2035. If the determining factors developed unfavourably, the figure would be 51.2 percent.
DAK calls for stronger Tax financing
DAK CEO Andreas Storm warned that social security contributions could not realistically be capped at 40 percent, contrary to previous political announcements. In statutory health insurance alone, contributions are threatening to jump from 16.3 to 19.3 percent over the next ten years.
In order to curb the increase in costs, the DAK recommended greater tax financing of statutory health and long-term care insurance. This could reduce the increase in health insurance contributions by 0.6 percent and that of long-term care insurance by 0.3 percent by 2035. In the base scenario, the average contribution rate would then only rise to 47.7 percent. If the expenditure of statutory health insurance funds were linked to the development of the income subject to contributions, the overall contribution rate could even be limited to 45.9 percent in the base scenario.
All areas affected
In nursing care, the contribution rate could reach 4.1 percent as early as 2030, according to the study. In unemployment insurance, an increase to 3.0 percent is expected by 2035. For statutory pension insurance, the researchers have calculated a contribution increase from the current 18.6 to 22.3 percent, taking into account the planned pension package of the traffic light coalition.
The independent IGES Institute was founded in 1980 as the “IGES Institute for Health and Social Research” founded by employees of the TU Berlin.