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At a meeting of the State Council, China’s Cabinet, on Tuesday, Premier Li Keqiang said it is important to keep the social insurance premium(保险费) policy stable(稳定), which to a large

extent has eased people’s worries at a time when a new regulation on premium collection has aroused public concern.

The general offices of the Communist Party of China Central Committee and the State Council recently issued a reform plan for tax collection, which includes pension, medical, unemployment, occupational injury and maternity insurance will be uniformly collected by the taxation authorities from Jan 1, 2019.

In fact, the taxation authorities have been collecting social insurance premiums for more than one decade. Social insurance premiums in 19 provinces and regions are collected by the local taxation authorities.

In  particular,  companies  have  expressed  concern  over  the  uniform  collection  of  social insurance premium by taxation authorities mainly for three reasons.

First,  the  new  regulation  indicates  the  reform  of  the  collecting  system  as  a  result  of institutional reform of the State Council. The companies are worried especially because they believe compulsory collection of social insurance premium will increase their expenditure on social insurance.

Second, since the taxation authorities are fully in charge of social insurance premium collection, the companies fear that the establishment of a new collection system will    prevent enterprises   escaping paying the social insurance premium.

Third, the media have reported that lately the local authorities in provinces such as Jiangsu, Heilongjiang and Hubei have been ordering enterprises to pay the arrears ( 欠 款 ) in social

insurance premium they should have paid in the past years.

These factors have increased the companies’ concern over the new premium-collection regulation.  Some  people  assume  the  reform  will  increase  the  companies’  cost,  and  some companies have even begun to lay off employees fearing that “winter is coming”.

Thanks to the current premium-collection system, the companies have managed to not pay a huge amount of social insurance premium. Take urban workers’ basic pension insurance for example. It is estimated that the companies have paid only about two-thirds of the total amount of social insurance premium. Calculating on the basis of the data for 2017, this year the actual social insurance premium collection is 3.34 trillion yuan ($487.71 billion), while the total amount should be 5.08 trillion yuan. The due amount is more than one-third of the total that should have been paid.

Some background information about the social         insurance It is of 1.to keep the social insurance premium policy stable.

The State Council issued a reform plan for tax collection, 2.

premium policy

all kinds of insurance.

The 3.for the  concern  expressed by some enterprises

First, the companies are 4.that compulsory collection of

social  insurance  premium  will  increase  their  expenditure  on  social insurance.

Second, the companies fear that the establishment of a new collection system will5.enterprises escaping paying the social

insurance premium.

Third, the local authorities think it a6.for companies to pay the arrears in social insurance premium they should have paid in the past years.

The7.on

some   companies   and people

Some companies have even begun to lay off employees fearing that “winter is coming” .

Some people think the reform will8. the companies’ cost.

The9.of current premium-collection system

The companies have paid only about two-thirds of the total 10.of social insurance premium.

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