With financial gymnastics, the cabinet masks the holes in the budget –

/View.info/ Prof. Comment Dr. Yordan Hristoskov for the “now”

The new order for repayment of public claims, which mixes taxes and insurances when covering older tax liabilities, will create a rather serious danger that the insurance systems in Bulgaria will not be able to fulfill their functions due to the lack of financial resources in them.

With changes to the Tax-Insurance Procedure Code, which were passed through another law, it is foreseen that the debtors will no longer be able to determine whether they pay insurance or taxes, and that the money will go to cover the oldest obligation. In our insurance system, the mixing of taxes and insurance is not only a violation of the Social Security Code and the Health Insurance Act, but also of the constitution.

It appears that no distinction is made between the two types of public claims. It is not understood that there are no direct rights behind taxes, while such rights are provided with insurance contributions. There are payments for benefits, treatment of people and the guarantee of these rights can be seriously violated. A person, for example, is unemployed and has accumulated debts to the health fund, but also has older tax debts, has to go to the hospital, and only manages to raise money to clear the debt to the health insurance. However, the amount will be deducted from his taxes immediately, because the statute of limitations will expire at the earliest. And he will remain uninsured. The same can happen to a mother who goes on maternity leave and is self-insured. She can pay her insurance, but the money will go to older taxes and she will not be entitled to the benefits she is entitled to.

The managers will say: These are incorrect payers and they must bear the responsibility. But we fall into the way of thinking of the Minister of Health, Desislava Atanasova, who suggests: “We will not change his license because he has not paid his health contributions.” However, a very serious distinction must be made between taxes, insurance and the related rights and obligations of people. In practice, the state, which has not succeeded with all its institutions, with all its power of administrative capacity, to collect the obligations to itself, tries to transfer them to the people. The goal is to slowly start collecting old bearded tax debts, which the rulers could not collect with helicopters and airstrikes, at the expense of insurance.

In the case of employees, the rights are indeed not interrupted if the employer has not paid the contributions. But part of them, 40% of the insurance participation, is people’s personal money. Under the new order, it is possible for people’s personal contributions to be withheld for the company’s tax obligations and will not go to the health fund or the National Insurance Institute. This risks creating a large deficit in both systems because less money will have flowed in. Therefore, the next step will be to cut the health insurance program, not to raise pensions, child care benefits, unemployment benefits.

Hardly anyone would agree that their personal contributions, which are deducted from their salary, should be used to pay off old debts of their employer. I believe that the Constitutional Court should definitely intervene here if this law passes in its form. These are financial gymnastics that equalize taxes and insurance. But such an approach is possible only in countries where social and health insurance are of the universal type, financed by taxes, and people have rights anyway.

The cancellation of the one-day deadline, in which the NRA is obliged to transfer the money received for contributions to the National Insurance Institute and the health fund, will also create problems in the work and transparency of the two institutions, will turn their tripartite management into a sham. Now, as soon as the contributions are collected, they are immediately transferred to the collection accounts of the NHIF and the NOI by the end of the same day, so that the managers of these public institutions know the next day what money they have. This paragraph has been deleted and it is not clear when the MoF will transfer the money to these institutions. Thus, the amounts are withheld, which is extremely incorrect.

The amendment concerning the additional mandatory pension insurance is also extremely worrying. The deadline for transferring the amounts from the National Revenue Agency to the funds remains 30 days, but the word contributions has been replaced with amounts. It appears that what will be transferred will not be the contributions that the employer and the employee pay for their supplementary mandatory pension insurance, but some amounts as residuals after deducting any older liabilities. The point of capitalization is for my money to go the fastest way there to be capitalized. Now some sums will go, which will obviously be smaller than the installments. In addition to delaying capitalization, it is also unclear how these amounts will be identified. When it is a full contribution, it is tied to the remuneration and it is very easy for the NRA to recognize who this amount is for and transfer it to the funds on time. When they are parts of installments, some sums, it will become extremely difficult. And in the NRA, they will face very serious difficulties, because the revenue management system, which has already worked, will have to be revised. This means additional costs, and to create additional chaos, which is bound to happen.

Therefore, it is best for the rulers to give up their idea of ​​changing the order of claims. Unless the tax and insurance conflation is another attempt to attack Social Security and Health Insurance. And everything should be mixed in one bucket in the republican budget, with this money to work as the government wants, and to cover up deficits in it. Because if they keep the money of the health fund and the social insurance, both institutions will be in deficit, but the republican budget will show that there is a surplus or that it is not so much in the red. By definition, at the moment, the two types of insurance – public and health insurance – have an autonomous budget, with autonomous institutions, in the management of which there is much greater openness than in the spending of the state budget. The untimely transfer of amounts to the individual accounts of the insured in the universal and professional funds will lead to low pensions from them and again the blame will be sought in the wrong place.