The College of Administrative Managers of Madrid has proposed that in order to favor the regular hiring of domestic service workers, the expenses incurred by families can be deducted in the full amount in the income tax return.
In a recent study by the Public Management Observatory of the Illustrious Official College of Administrative Managers of Madrid (Icogam), on domestic employment, administrative managers launched the proposal.
They indicate that the effects that could be achieved are the increase in collection with the consequent reduction in public spending, the labor regularization of a productive activity, the fight against tax fraud and the submerged economy, formalizing the work and residence situation of a important part of the collective and the regularization of the Social Security contribution system or the taxation of economic activities.
The Administrative Managers of Madrid consider that the creation of a tax incentive would promote the regularization of the contracting of domestic service, which despite the latest modifications continues to present high rates of irregularity.
As the study points out, there are several autonomous communities that already apply incentives for hiring domestic service, such as Andalusia, where there is a deduction for domestic help of 15% of the annual contribution paid to Social Security by domestic staff. , with a limit of 250 euros per year.
In Castilla y León there is a similar deduction, but the limit is raised to 300 euros in certain circumstances. And Galicia, a deduction was contemplated that is 30% of the amounts paid to household staff who are in the care of a child under 3 years of age, with a maximum limit of 400 euros, which rises to 600 euros if there are two or more children.
The Icogam indicates that in all cases, they are deductions in the IRPF quota “since it is the mechanism to help the lowest incomes more effectively.”
According to studies, domestic workers comprise a significant part of the global workforce, are considered one of the most vulnerable groups, and an estimated 76.2% are women. Within the European Union, the European Commission estimates the percentage of women among domestic service workers at 90%. It is estimated that 30% of the workers were from a country outside the EU, while 15% belong to another member country. The volume of informal work is between 70-80%, that is, undeclared, so workers do not have the same coverage as other workers in the system.
Among the EU countries with the highest rate of regulated domestic employment are France with 70%, Spain with 65% and Italy with 45%.
According to the data from the Icogam OGP report, the staff dedicated to domestic service in Spain is mostly female, with almost a third part of the informal economy and a strong foreign presence, especially from outside the EU.
RD Law 16/2022, approved on September 6, for the improvement of working conditions and Social Security of workers in the service of the home, “aims to equalize the working conditions and Social Security of workers in the family home to those of the rest of the workers employed by others, ruling out those differences that not only do not respond to justified reasons, but also place this group of workers in a situation of particular disadvantage and that, therefore, They can be discriminatory.
Among the main additions of the standard are the coverage of gaps in contribution, which disappears the so-called figure of withdrawal, commonly known as free dismissal and access to Fogasa is recognized.
In the opinion of the president of Icogam, Fernando Jesús Santiago Ollero, “this legislation brings justice closer to this group and now all that remains is to encourage the disappearance of their irregular hiring. Therefore, we ask the Government to consider our proposal, which to some extent has already been considered by some autonomous communities.
The College of Administrative Managers of Madrid proposes that domestic service expenses can be deducted from personal income tax