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Spanish Government's Self-Employed Contribution Reform Sparks Heated Debate
Madrid, Spain – A new self-employed contribution system proposed for Spain, set to take effect between 2026 and 2028, has sparked considerable debate among financial experts and entrepreneurs. The system aims to adjust social security contributions based on actual income, a move that proponents argue will create a more equitable and sustainable pension framework. A politician, whose comments were featured in a recent online video, stated that "this agreement will benefit the immense majority of self-employed people in our country" and that "pensions will cease to be low and will have a relation with the contributions made." However, legal and financial expert LawTips, in his analysis, strongly criticized the proposal, arguing that it penalizes lower-income self-employed individuals. "Those who will pay almost half of what they earn are those who earn the least," LawTips asserted, highlighting a table of proposed quotas that show significant increases for those in lower income brackets. He further contended that equating self-employed contributions with those of salaried employees ignores the inherent business risks, lack of guaranteed income, and absence of benefits like paid holidays or severance pay for entrepreneurs. LawTips also warned that the changes could lead to digital entrepreneurs relocating to other countries to avoid the increased financial burden. He concluded that the pension system is "totally unsustainable" and that the government is seeking to extract funds from the self-employed, creating a "complete disincentive to entrepreneurship."
