Income Tax: For the first time, self-employed professionals paid more than salaried employees

For the first time, the average income tax paid by self-employed professionals (€2,472) has surpassed the average tax paid by salaried employees (€1,816). Previously, salaried workers and retirees paid the most. According to the Ministry of Finance, the new tax law for self-employed professionals (deemed income) is fairer because it taxes their actual income.

The Ministry of Finance has set a minimum taxable income (deemed income) of €10,920 per year for self-employed professionals based on the gross earnings of the minimum wage (€780 × 14 months).

According to the data analysis, half of the self-employed professionals (402,183 out of 724,465) reported a monthly income of €268 or an annual income of €3,215. These individuals were taxed as if their income were four times higher than reported, resulting in an average tax of €1,733.

This amount is further increased by the professional tax, which has been reduced by 50% (€325). Consequently, the average tax burden for those self-employed professionals subject to deemed income amounts to €2,058. Those not subject to deemed income reported earnings of €15,013 annually or €1,251 monthly. The additional revenue for the government from this new tax system, compared to last year, is about €440 million.