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Social Security contributions

Social security contributions are the main vital resource that makes the revenues of the Gen. Auth. For S.S and Pensions as the Act of Social Security and Pensions No.( 25 ) has defined that the social security contributions are the most essential resource for the Social Security Fund where the clause No. (12) reads as the social security for old age , invalidity and death be funded by the following resources:
-6% out of the salary is the proportion committed by the hiring party to be, on monthly basis, remitted to the Social Security Fund.
- 6% out of the salary is the proportion committed by the secured employee to be monthly remitted to the Social Security Fund.
-In addition to 1% injury- during –work security contributions guaranteed by the hiring party where the contributions are to be transferred to the Gen. Auth. for S.S. and Pensions' account in the Central Bank of Yemen.

The following schedule set forth hereunder illustrates the social security contributions during 1991- 2001.
 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

source: the General Department of Revenues.
( 1) The Social security Act No.( 25) for the year 1991 , clause No.(12)
source: the Gen. Auth. for S.S. and Pension's final statement of accounts (1991- 2001).


It is noticed that social security contributions were increasing over the years 1991,1992 that reached YR687,778,000 ,with an increase rat of 33,56%, which were basically the previous years' social security due contributions of several organizations' employees subject to the Social Security Act No.( 25) for the year 1996.

Whereas the regulated increase average during the year 1993,1994 by approximately 3% due to the normal annual salary-increase.

The contributions rate increased in 1995 as a result of direct social security contributions exclusions ,made by the Ministry of Finance ,of many governmental apparatuses subject to the Social Security Act No.( 25) 1996.

Also, the social security contributions increased during the year 1996 by 32% comparing with the previous year 1995 . this is attributed to the Cabinet resolution that states price- hikes allowance to be granted to all administrative employees of the State ,and to the private sector as well, during the period 1992- 1995 in addition to their salaries which was back then the basis for defining the social security contributions.

And the contributions increased in the year 1997 by 13,6% due to the aggregation of late due social security contributions.

In 1998, the price-hikes allowance was added to salaries, consequently, rising up the amount of contributions made to the Gene. Auth. for S.S. and Pensions.

As a result of amending the Act no. (25) 1991 by the republican decree No. (1) for the year 2000 ,that was issued in January, social security contributions increased in 2000 , and a number of clauses were amended to make the total wage paid the basis of social security contributions . The total wage, as defined by the decree, is the salary in addition to allowances of the secured employee except awards and additional wages, therefore, the social security contributions rate was 93% which is high when compared with the rate of the last year.

Social Security contributions collection and exclusions from source suggestion:

The problem of getting the due social security contributions and efforts needed to be exerted to follow up all State's apparatuses especially after the implementation of local council governance is a major challenge encountered by the GASSP . Exclusion of contributions of social security form sources i.e. Ministry of Finance to the bank account of GASSP is the most appropriate measure to terminally end such consistent problem . This is the aim that the GASSP is longing to achieve.

 


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