Social security funds benefit from host of indirect levies

Private consumption carries an extra burden of more than 1.5 billion euros annually in the form of indirect levies for the social insurance system. This is on top of the other contributions which the multitude of funds receive directly from the state budget. In practice, the consumer pays for social insurance when buying cigarettes, newspapers, bread, alcohol, tickets for a football match or simply for the bus. He also makes contributions when consuming water, selling his house or buying jewelry, even when sentenced to a prison term which he buys out or when paying a fine; 6.5 percent of such penalties go to lawyers’ and jurists’ funds, totaling about 3 million euros annually. «Social levies,» as they are called, are in practice a hidden sore of the social insurance system. They are the result of pressure exercised by various interests or economic groups, creating a strong imbalance in the system as they are levied without the slightest sense of social solidarity. Indeed, the impending abolition of most of such levies is threatening the survival of several social insurance funds, creating additional headaches for the Labor and Social Security Ministry. The Agricultural Insurance Organization (OGA) receives the most important part of these social levies, as recorded in the social budget published last week. Its annual revenues are estimated at around 830 million euros. OGA receives 12 percent of all income tax collected, a part of stamp duty and special levies on tobacco, alcohol and other luxury items. Another source of revenue for the social insurance system is all the types of contracts registered with notaries. The Lawyers and Jurists’ Fund receives 10 percent of payments involved in property transactions, 1.3 and 0.65 percent of the value of any contract and 0.5 percent on the capital of any commercial company (other than societe anonyme). The Athens Lawyers’ Welfare Fund receives 1 percent of the paid-up capital of firms. Publication costs of a firm’s charter in the Government Gazette is subject to a 5 percent charge in favor of the fund of staff working in the National Printing House. The multitude of projects and building works under way throughout the country are an important source of revenue for the Engineers and Public Project Contractors’ Fund, which receives 0.1 percent on all relevant budgets and a further 0.1 percent on the value of all imported equipment for building, plumbing, port and road works. The municipal workers’ pension fund receives 2 percent of the budget of all work carried out by the municipalities themselves, and this is estimated at around 1.5 million euros annually. The cement workers’ auxiliary fund also has significant revenue sources, receiving 2 percent of the price of all cement sold, which is estimated to be more than 5.4 million euros this year. The chemical engineers’ fund also receives 1 cent for every 11 tons of produced cement, 1 cent for every 170 liters of alcohol sold, 1 cent for every 170 kilos of produced dough and 1 cent for every 8 tons of acid produced! Advertising levies As evasion of social security contributions by employers is quite a frequent phenomenon, the advertising levy on all types of announcements and commercials (including radio and television spots) is the main source of revenue for all main and auxiliary funds of media workers. Six such funds receive a total of 20 percent of the cost of adverts and 21.5 percent of ads on radio and television. These are estimated to total at least 1 billion euros. The list is especially long. Policemen’s funds receive 10 percent of the cost of tickets for football, basketball, water polo and tennis matches. The Social Security Foundation (IKA) receives a contribution levied on Thessaloniki’s urban transport tickets, while the Public Servants’ Auxiliary Fund gets 2 percent of the fees for medical examination of those applying for a driving license.