Reform of PRSI system for self-employed is long over-due – McGrath

Independent TD Mattie McGrath has welcomed a nationwide review of the PRSI system which has been initiated by the Minister for Social Protection Leo Varadkar. The review which consists of surveying up to 20,000 individuals is specifically aimed at assessing whether the self-employed would welcome an opt-in social welfare system in order to access social welfare entitlements:

“Reform of the PRSI system for the self-employed is something that ought to have been undertaken well before now.

Indeed the unfairness that characterises how PAYE workers are treated within the tax system in comparison to the Self-employed is fairly stark.

We know for example that a PAYE employee will not pay PRSI if they earn less than €18,304 a year.

This is not the case for the self-employed who pay PRSI at 4% on any earnings in excess of €5,000 as they are entitled to no PRSI credit, and must pay a minimum of €500 in PRSI a year.

We also know that under the current system neither Disability nor Invalidity Benefit is covered for the self-employed despite that sectors contribution of significant volumes of tax to revenue each year.

These are serious challenges that present enormous difficulties to self-employed people when for one reason or another they cannot work.

It is only fair that some form of social safety net is introduced in order to redress this imbalance.

In light of that I welcome the survey that is being initiated by the Minister today and urge all self-employed people in Tipperary to use this opportunity to make their views known on this matter,” concluded Deputy McGrath.

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