Metro Manila (CNN Philippines, January 19) — The Social Security System (SSS) on Thursday started implementing the increase in contributions from its members.
In a statement, the state-run pension fund announced that the contribution rate is now at 14% — up from last year’s 13%.
Employers will bear the additional 1%, bringing their contribution to 9.5%, while employees will be charged the remaining 4.5%, according to the SSS.
“Under existing tax laws, employers would be allowed to deduct their share of the contribution hike from their taxable income,” SSS President and Chief Executive Officer Rolando Macasaet said. “This underscores a whole-of-nation approach in securing the future of our workers with the Philippine government also contributing in the form of tax relief to employers.”
The scheduled hike is in accordance with the provisions of Republic Act 11199, or the Social Security Act of 2018, which mandated a contribution increase “to ensure the financial viability of the state pension fund for private sector workers.”
Enacted in February 2019, the law allows the SSS to gradually increase the contribution rate by 1% every two years until it reaches 15% by 2025.
Business groups earlier urged the SSS to suspend the implementation of RA 11199 this month, but the pension fund argued that postponing the measure would “reduce the actuarial life of the fund.”
