Rates of deductions for social insurance may be differentiated in Azerbaijan
Azerbaijan, Baku, Oct. 10 / Trend A. Akhundov /
The Azerbaijani State Social Protection Fund has submitted proposals on making changes to the legislation to differentiate the interest rates of social security contributions to the government, the Azerbaijani State Social Protection Fund chairman Salim Muslimov told media today.
"We have submitted our proposals on the changes to the presidential administration and Cabinet of Ministers," he said. "These changes are being considered by the relevant bodies. If there is a general conclusion that these changes are necessary a decision will be taken on amendments to the law on Social Insurance".
Around 25 per cent of salaries are transferred for social security payments in Azerbaijan, of which the employer pays 22 per cent, whilst three per cent is deducted from the employee's salary.
"Firstly we propose the employer pays 25 per cent if the employee's monthly salary does not exceed thrice the amount of the minimum salary," he said. "The employer pays 18 per cent and the employee seven per cent if the salary ranges from three-fold to 20-fold the amount of the minimum salary.
"If the salary is above 20-fold the amount, around 15 per cent will fall to the employer, 10 per cent - to the employee. That is, as far as the salary increases, the deductions for social insurance paid by the employee will also grow. Of course, the employer will try to indicate a high salary. However, it is profitable for the employee."
He said that these changes will be an effective measure in combating illegal employment and the fact of concealing the employees' real salary amount by their employers.