The government\u2019s proposed pension reforms will mean lower take home salaries for those who are currently working, the social security ministry confirmed to The Luxembourg Times on Friday.\u00a0<\/p>\n
\u201cAs the contribution rate for the pension scheme rises […] 0.5%, the semi-net [salary after social security contributions] will be lower,\u201d a ministry spokesperson said.\u00a0<\/p>\n
The government\u2019s proposal unveiled on Wednesday<\/a> states that it intends to increase social security contributions from the current 24% to 25.5%. However, it had not explicitly stated how the increase will be split between employees, employers and the government.\u00a0<\/p>\n \u201cFor employees, this contribution is currently divided into three equal parts: 8% is paid by the employee, 8% by the employer and 8% by the state. As the government has now proposed to increase [contributions] from 24% to 25.5%, the three equal parts become 8.5%,\u201d the social security ministry spokesperson said.\u00a0<\/p>\n <\/p>\n Also read:Pensions talks leave unions and employers frustrated<\/p>\n <\/a><\/p>\n For self-employed workers, the contribution will rise from 16% to 17%, while the state will cover the remaining 8.5%. This means the self-employed will shoulder double the increase of salaried employees.\u00a0<\/p>\n The government said it plans to review the status of self-employed<\/a> workers – statut de l\u2019ind\u00e9pendant – in the coming months to address social security contributions for this group.<\/p>\n The ministry estimates the change will cost the state about \u20ac187 million per year on average between 2026 and 2029. It did not provide a breakdown of how much additional burden is expected to cost employees, employers or the self-employed.<\/p>\n