The National Bank yesterday announced, through Lucian Croitoru,adviser to NBR Governor Mugur Isărescu, that it is in favour of a3% cut to social security contributions paid by employers, whichwould be good news for employers, considering that privatecompanies have made over 700,000 people redundant since 2009 (theyear when the CAS - social security contributions were hiked by3.3%).
"This measure needs to be implemented as soon as the conditionsfor cutting the CAS are met. It appears that corporate taxation isexcessive in Romania and everybody knows what employment costsemployers bear. I think reducing social security contributions issustainable as far as the state budget is concerned, but exactcalculations are made by the Finance Ministry," Croitoru said.
Specialists say cutting social contributions paid by theemployer and the employee by 3% (from a total of 44% to 41% ofcontributions corresponding to every gross salary) could lead tothe creation of 100,000 new jobs and to around 380 million euros insavings for companies.
So, for a company with 100 employees earning the average salaryin Romania, with an average gross expenditure by the employer of2,500 lei/employee, the savings resulting from a 3% cut to thesocial security contributions would amount to 90,000 lei (21,500euros), which the employer could use to cover salary expenses forat least three new employees.
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