The collection of social security contributions : administrative implications

Abstract

This dissertation is intended to analyse the shortcomings that are found in the method of collection of social security contributions. The Social Security Act emphasises that the payment of social security contributions is to be the principal obligation of every insured person, to secure the amount of revenue required for the expense of contributory benefits. The analysis indicates that the shortfall in revenue collected results from the lack of enforcement on employers and on self-employed who tend to fail to affect their due payments within the time limit. Also, employers tend to fail to transfer social security contributions to the State on behalf of their employees, whilst the self-employed tend to declare a low income in order to affect a low rate of payment. This study also indicates the link that exists between the Social Security Department and the Inland Revenue Department - which acts as the collecting agent of the former. Lack of co-ordination between the two main departments gives rise to inefficiency in the system of collecting revenue due as social security contributions.