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  • 05/24/2018

    Ljubljana, 24 May (STA) - The taxation of wages in Slovenia rose by 1.4 percentage points to 40% in 2017, the Statistics Office said on Thursday.

    Out of the costs of labour per employee that earned 67% of average wage, 40% went for taxes and the remaining 60% were net earnings.

    The tax burden for a single person without children reached 91% of additional gross earnings, which means that by moving from unemployment to employment single persons saw their net income increase by just 9% of gross earnings.

    The difference, called the unemployment trap, occurs due to higher taxes and social contributions and lower social transfers in employment, compared to higher social transfers during unemployment.

    Compared to 2016, the tax burden at moving from unemployment to employment for a single person without children increased by 1.4 percentage points.

    In 2017, the tax burden at moving to a higher paid job reached 51.2% of additional gross earnings for a single person without children, while for a couple with two children it was 102.5%, which is called the low wage trap.

    The low wage trap indicator shows the difference in net earnings of employed persons at moving to a higher paid job (from 33% to 67% of average gross earnings) due to higher taxes and social contributions and lower social transfers.

    Compared to 2016, the tax burden at moving to a higher paid job for a single person without children increased by 2.8 percentage points, while for a couple with two children it decreased by 1.7 percentage points, the Statistics Office said.


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