Abstract

BLANCO, Andrés. TAXES AND SOCIAL SECURITY. First notes to characterize the current system. Rev. Fac. Der. [online]. 2021, n.52, suppl., e303.  Epub Dec 01, 2021. ISSN 0797-8316.  https://doi.org/10.22187/rfde2021n52espa7.

The article focuses on some general matters on the public revenues relating to the Social Security. As an introduction, it is pointed out that not even the solution of a problem, but its own existence, depends on the affiliation to a certain theoretical paradigm. On such basis, the “sustainability” of the social security is a problem within a neoclassical conception of public finance, but not -for instance- form a postkeynesian viewpoint. Additionally, the problem of “sustainability” only appears in the “contributive system”, but not in other structures of relationship between spending and revenues of social security. For those reasons, the rationale of the “contributive system” are examined critically, and at the same time other theoretical explanations of such system are exposed. Then, I propose the material effect of the contributive system must consider not only the payments to beneficiaries, but the burden of taxes on wages, directly or indirectly through the tax shifting, on the basis of the “net social wage” concept. That analysis allows to conclude that the tax burden on wages reduces significantly the workers’ benefits.

Keywords : financing social security; contributive system; payroll taxes; tax shifting; social net wage.

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