Studying while self-employed could bring bigger contribution discounts

Editor’s note: This article was first published in June 2012, reporting a proposal then under study by Spain’s Ministry of Employment. The 50% discount for under-30s, the ATA proposal and the 32,500 new entrepreneurs figure are 2012 data, and self-employed contribution rules have changed several times since.

This is both information and news. People under 30 who register as self-employed with Spain’s Social Security (the scheme for autónomos) already get a 50% discount on their monthly contribution. Now Fátima Báñez’s ministry is considering going further and giving bigger discounts on Social Security registration to vocational training and university students who combine their studies with working for themselves.

The idea is to encourage self-employment with a message of “hope, confidence and calm”. According to the minister herself, it is a “novel” initiative that aims to let young people study and work for themselves at the same time, much as employees already can through the training and apprenticeship contract (contrato de formación y aprendizaje).

The proposal put forward by the self-employed workers’ association Asociación de Trabajadores Autónomos (ATA) is to waive 100% of contributions in the first year, 75% in the second and 50% in the third.

If it goes ahead, the measure would form part of the agreement to promote an entrepreneurial culture that the government and several self-employed organisations are working on. Some 32,500 people have become entrepreneurs since the labour reform came into force, more than half of them young people, figures that show the scheme is working given the economic relapse we are going through.

Other measures

Politicians are politicians, and they defend their ideas as good ones even when they are not as positive as they make out. In fact, the ministry has backed other measures to boost self-employment, such as:

• Letting unemployed people up to age 30, or up to 35 for women, take 100% of their unemployment benefit as a lump sum (capitalización) to start a business.
• A 50% discount on Social Security contributions during the first 18 months for family members who help out in a self-employed person’s business.
• A reduction of up to 50% in contributions for self-employed people who also work for an employer (pluriactividad).

Featured image: Parti Popular de Melilla, CC BY-SA 2.0, via Wikimedia Commons.