At a meeting of the State Council, China's Cabinet, on Tuesday, Premier Li Keqiang said it is important to keep the social insurance premium（保险费） policy stable（稳定）, which to a large extent has eased people's worries at a time when a new regulation on premium collection has aroused public concern.
The general offices of the Communist Party of China Central Committee and the State Council recently issued a reform plan for tax collection, which includes pension, medical, unemployment, occupational injury and maternity insurance will be uniformly collected by the taxation authorities from Jan 1, 2019.
In fact, the taxation authorities have been collecting social insurance premiums for more than one decade. Social insurance premiums in 19 provinces and regions are collected by the local taxation authorities.
In particular, companies have expressed concern over the uniform collection of social insurance premium by taxation authorities mainly for three reasons.
First, the new regulation indicates the reform of the collecting system as a result of institutional reform of the State Council. The companies are worried especially because they believe compulsory collection of social insurance premium will increase their expenditure on social insurance.
Second, since the taxation authorities are fully in charge of social insurance premium collection, the companies fear that the establishment of a new collection system will prevent enterprises escaping paying the social insurance premium.
Third, the media have reported that lately the local authorities in provinces such as Jiangsu, Heilongjiang and Hubei have been ordering enterprises to pay the arrears （ 欠 款 ） in social insurance premium they should have paid in the past years.
These factors have increased the companies' concern over the new premium-collection regulation. Some people assume the reform will increase the companies' cost, and some companies have even begun to lay off employees fearing that “winter is coming”.
Thanks to the current premium-collection system, the companies have managed to not pay a huge amount of social insurance premium. Take urban workers' basic pension insurance for example. It is estimated that the companies have paid only about two-thirds of the total amount of social insurance premium. Calculating on the basis of the data for 2017, this year the actual social insurance premium collection is 3.34 trillion yuan ($487.71 billion), while the total amount should be 5.08 trillion yuan. The due amount is more than one-third of the total that should have been paid.
Some background information about the social insurance It is of to keep the social insurance premium policy stable.
The State Council issued a reform plan for tax collection,
premium policy | All kinds of insurance. |
The for the concern expressed by some enterprises | First, the companies are that compulsory collection of social insurance premium will increase their expenditure on social insurance. |
Second, the companies fear that the establishment of a new collection system will enterprises escaping paying the social insurance premium. | |
Third, the local authorities think it a for companies to pay the arrears in social insurance premium they should have paid in the past years. | |
The on some companies and people | Some companies have even begun to lay off employees fearing that “winter is coming”. |
Some people think the reform will the companies' cost. | |
The of current premium-collection system | The companies have paid only about two-thirds of the total of social insurance premium. |
