Area: Finance
Competent authority: MDDSZ, MF, MZ
EZU URL: .nan
Initiative ID: 1000
Initiative accepted and completed: '2020-04-24'
Initiative classified in EZU: .nan
Initiative forwarded in response: '2020-02-26'
Initiative published: '2020-02-26'
Initiative submitted: '2020-02-25'
Response from the competent authority: Reply from the Ministry of Finance:Tax (and
  social security) legislation does not restrict taxpayers' choice of how to earn
  their income in a way that forces them into a particular status. However, from a
  status-law point of view, it is appropriate for a person who regularly carries out
  work activities through civil law contracts to regulate his or her status, i.e.
  whether to register as a person who carries out an activity on the market independently
  (e.g. a sole trader) if he or she carries out work in an independent relationship,
  or as an employee if he or she carries out work, as a general rule, for a single
  principal in a dependent relationship. The registration of a business entity has
  a broader meaning in the market (e.g. protection of creditors) and is not merely
  a prerequisite for the payment of public taxes.However, if there are no regular
  activities that do not constitute an organised business, there is no such need and
  tax legislation does not limit the payment of taxes and contributions to a specific,
  predefined/declared status. It should be added here that the tax treatment of income
  under Article 74 of the Tax Procedure Act is based on its actual economic substance,
  not on the basis of an outwardly declared (possibly fictitious) form.The Financial
  Administration of the Republic of Slovenia collects social security contributions.
  The concept of collection, according to the provisions of the Tax Procedure Act,
  means levying, assessment, payment, repayment and enforcement.The Social Security
  Contributions Act establishes the rates of contributions for pension and invalidity
  insurance, compulsory health insurance, maternity care and employment, for which
  the bases and obligations to pay contributions are determined in accordance with
  the laws on the basis of which the contributions are introduced.It is essential
  that the determination of the obligations and the basis for the payment of compulsory
  social security contributions and the entitlements arising therefrom are regulated
  by laws in the field of social insurance, which fall within the competence of the
  Ministry of Labour, Family, Social Affairs and Equal Opportunities and the Ministry
  of Health. It should be pointed out that, in principle, the scope of the insured
  person's rights depends on the basis on which social security contributions are
  payable.Reply from the Ministry of Labour, Family, Social Affairs and Equal Opportunities:Pension
  and invalidity insurance, which covers the entire working-age population, is one
  of the social insurance systems for the operation of which the State is responsible,
  acting as the guarantor of the social rights of individuals in the event of old
  age, disability and death. The Law on Pension and Disability Insurance (Official
  Journal of the Republic of Slovenia No 96/12, as amended, hereinafter referred to
  as ZPIZ-2) pursues the principle of unification of all forms of work, in such a
  way that all forms of work are subject to the same contribution burden. Thus, if
  an individual secures his material and social security through the pursuit of an
  activity, the contributions made in this respect during the active period and the
  periods of insurance are subsequently taken into account for the purposes of acquiring
  pension and invalidity insurance rights. With regard to the specific proposal, we
  would thus like to clarify that the principle of the obligation to provide insurance,
  which is one of the most important principles of compulsory pension insurance, requires
  that all individuals who carry out a job or activity must be compulsorily covered
  by pension insurance. There is a single system of pension and invalidity insurance
  for all insured persons, based on compulsory affiliation, which means that we are
  not free to decide whether or not to be affiliated. If a person starts work or any
  self-employed activity, this creates a legal basis for compulsory affiliation and
  thus for the statutory payment of contributions. In accordance with the general
  principle of Article 22(1) of the Social Insurance Act (ZPIZ-2), compulsory insurance
  lasts from the beginning until the termination of the legal relationship giving
  rise to the insurance. Compulsory insurance also confers rights on the basis of
  the insurance, which cover the risks of old age, invalidity and death. Even in the
  case of so-called "afternoon" self-employed persons (a self-employed person who
  is not insured as self-employed under Article 15 of the Social Insurance Act, but
  is compulsorily insured on the basis of an employment relationship or on some other
  preferential basis, and who also carries on a self-employed activity), they are
  required to take out insurance at least for invalidity and death resulting from
  an occupational injury or disease, and to pay the contributions in lump sums. Under
  pension legislation, virtually any work or activity is considered to give rise to
  the possibility of disability and, in some cases, even death. It is therefore essential
  that all those who carry out a job or activity on a more or less permanent basis
  should also be insured for these events (in the event of an occupational injury
  or disease). By providing for this, the legislator protects precisely those who
  carry out a secondary activity (in addition to their regular employment), since
  they are guaranteed a minimum level of social protection in the event of an insured
  event by means of extremely low flat-rate contributions to pension and invalidity
  insurance. Reply from the Ministry of Health:We believe that the Ministry of Finance
  has provided a very clear and appropriate response to the above-mentioned initiative.
  On the side of the collection of contributions for compulsory health insurance,
  we would add that the different status forms of work and the related levels of the
  compulsory health insurance contribution also reflect the extent of the benefits
  that the insured persons receive from compulsory health insurance in this case.
  Thus, if the insured person works as an employee or self-employed person, the benefits
  under the compulsory health insurance are broader or provide a greater range of
  rights (the person is covered for injury and sickness outside work and for occupational
  injury and sickness) than if, as a result of non-continuous work which is not in
  the nature of work under an employment contract, he or she works under an employment
  contract, where he or she is covered only for the contribution for occupational
  injury and sickness. The difference is also reflected in the entitlement to wage
  compensation, which is due to employed or self-employed persons in the event of
  injury or sickness (at work or outside work), but not to persons who work under
  a civil law contract. The amount of the contribution rate, the contribution base
  and, consequently, the scope of the entitlements are therefore directly dependent
  on the legal status of the insured person, while the legal status is something that
  a person decides in principle on his or her own, depending on the nature, scope
  and content of the work that he or she performs.Furthermore, it is necessary to
  add that compulsory health insurance is one of the social insurances in the Republic
  of Slovenia, based on the principle of solidarity as one of the fundamental principles.
  This principle guarantees that insured persons, when they need health care (regardless
  of their status), can receive it, regardless of the amount of contributions paid
  by them. Those who earn more pay more and those who earn less pay less, but they
  are on an equal footing when it comes to accessing benefits. Furthermore, compulsory
  health insurance must at all times guarantee the coverage of the rights deriving
  from it (the right to payment for health services, the right to wage compensation
  for temporary absence from work and the right to reimbursement of travel expenses),
  and it can only do so if its resources are liquid, i.e. it continuously obtains
  them from contributions and other sources (national and municipal budgets). The
  proposal must therefore be rejected for all the reasons set out above, and also
  on the grounds that only regular and predictable inflows into compulsory health
  insurance can guarantee the development and overall provision of health care within
  the framework of the basket of rights.
Text file: 1000.txt
Title: Compulsory monthly contributions and sole traders
URL: https://www.stopbirokraciji.gov.si/pobuda/?st=1000
