In this article we will discuss the topic of social contributions and welfare costs in Spain.
In Spain as well as in France, you have to pay different organizations: the Social Security (dealing with all the health issues), unemployment insurance guarantee fund and professional training.
Here are the major social contributions rates.
The system for auto-entrepreneurs is different.
The column “Employer rate” level only applies for the limited companies in Spain.
| Employer Rate | Wages Rate | Total | |
| Social security: health | 23.60% | 4.70% | 28.30% |
| Unemployment insurance | 5.50% | 1.55% | 7.05% |
| Guarantee fund for employees | 0.20% | – | 0.20% |
| Vocational training | 0.60% | 0.10% | 0.70% |
| Total | 29.90% | 6.35% | 36.25% |
| occupational accident | Variable (between 0.90 and 7.30%) | – |
You can see that the Spanish social contributions for both employees and employers are lower than those of other European members. For example, in France a manager would pay between 35% and 45% instead of 30.60% in Spain. The difference is even more significant for employees. A manager would pay only 6.35% of social contributions for its employees whereas it would pay about 20% in France. The Spanish taxation system is then very advantageous for business starting up.
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