McGillivray, Warren, 2001, “Contribution Evasion: Implications for Social Security Pension Schemes,” International Social Security Review, Vol. 54, No. 4.
Ross, Stanford G., 2000, “Building Pension Institutions: Administrative Issues,” The Third APEC Regional Forum on Pension Reform (Manila: Asian Development Bank).
Williams, David, “Social Security Taxation,” in Tax Law Design and Drafting, Vol. 1, ed. by Victor Thuronyi, Washington: International Monetary Fund.
Peter Barrand is a deputy division chief and Graham Harrison is a senior economist in the Revenue Administration Division 1 of the IMF’s Fiscal Affairs Department (FAD); Stanford Ross is a senior panel expert (FAD). The paper benefitted from comments from many colleagues in FAD, including Jean-Paul Bodin, Katherine Baer, William Crandall, Victoria Perry, Michael Keen, and Russell Krelove.
A draft of this paper was also discussed in November 2003, during a conference sponsored by the International Labor Organization (ILO) and the Slovenian Ministry of Labor, Family, and Social Affairs. The conference brought together social agencies, employers, and unions from CEE countries to focus on measures needed to improve contribution collection for pension schemes, whether public or private. In June 2004, the International Social Security Association (ISSA) met in Poland to discuss changes in the structure of social security administration, with concern for the efficient collection of contributions.
These institutions exist in many countries including Brazil, France, Germany, Japan, Mexico, and Thailand.
Examples of this model are found in Australia, Canada, New Zealand, Sweden, the United Kingdom, and the United States.
Health care and public pension contributions collection has been integrated into the tax agency, the SUNAT.
In the last five years, Peru has managed to integrate successfully the collection of its public pension system and its health care insurance scheme with the tax administration agency, the SUNAT.
In Canada, for example, where social benefits programs were designed from the outset to have collections and information reporting through the revenue administration, the social legislation itself is divided into two parts—one administered by the revenue administration, and the other one by the agency responsible for the social program.
Social agencies in some countries are moving away from this off-set approach in favor of paying the benefit themselves, to decrease audit work and revenue risk.
While administration of the health insurance scheme is the responsibility of the Health Insurance Institute (HII), authority was given to the SII to collect contributions.
Amendments to the law in 1994 required farmers, for the first time, to contribute to the pension system—albeit at a heavily subsidized rate.
It is estimated that less than 50 percent of private urban companies are known to the SII, of which around 80 percent make contributions.
The preparation was supported by a UK-DFID-funded project.
The LTU administers the largest 450 taxpayers—its revenue collection capabilities are more developed than those in the GDT are generally.
The universal pension schemes are defined contribution schemes and contributions accumulate in individual accounts. Persons are free to choose any universal fund for membership. The regulatory framework for the schemes is set out in a mandatory social insurance code legislated in 1999.
The SIAP was a 5-year multi-million project supported by the World Bank to modernize social security administration, including IT systems. It was launched in 1996, coinciding with the creation of the NSSI.
An assessment by the Intra-European Organization of Tax Administrations (IOTA) pointed to a need to upgrade the tax administration to meet EU standards. A similar conclusion had been reached by a joint IMF/World Bank mission.
Under the former project structure, GTD and NSSI project staff had continued to report to their respective agencies.
Including ministries of finance, labor and social policy, and health, and the GTD, the NSSI, the NHIF, and the NSI.
The health fund was established in 1997 and is administered by the National Health Insurance Agency (NHIA), an independent agency within the ministry of health. The pension fund is administered by the National Agency for Pensions and Other Social Insurance Rights (or the Pension Agency), which is part of the ministry of labor, social solidarity and family. The unemployment insurance fund, founded originally in 1991, was restructured by new legislation in 1999. It is administered by the National Agency for Employment, also an executive agency part of the ministry of labor, social solidarity, and family.
Revenues from wage taxes are a major source of local level government funding.
See The Swedish contributions collection system, Goran Smedmark and Yvonne Svenstrom, International Social Security Association, Interactions of Social Security and Tax Systems” (Geneva 1997).