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Instituto Nacional do Seguro Social or INSS for short is the National Institute for Social Security. This is an independent body linked to the Social Security Ministry.
INSS is responsible for collecting contributions to maintain the Brazilian Social Security system operating:
Any employee working under the CLT system automatically contributes to Social Security and consequently to INSS. Temporary or independent workers can opt to pay a monthly fee and apply to the Social Security program. The same thing applies to housewives, students and unemployed people. In this case, they will be considered optional payers.
The collection of the money destined to INSS varies according to the person's employment link:
Companies are automatically obliged to collect INSS from the employees' payroll. The amount of money to be discounted depends on the wages and amount paid to the individual. This value will be divided, quite simply, into 12 instalments to be paid from January to December. Put simply, the larger the salary the larger the contribution will be. However, the maximum discounted value in 2012 was 430.78 compared to 570.88 in 2017
|0 to 1,174.86|
|1,174.87 to 1,958.10|
|1,958.11 to 3,916.20|
|0 to 1,556,94|
|1,556,94 to 2,594,92|
|2,594,92 to 5,189,82|
Besides worker's contribution, there is also an employer contribution of 20%, calculated over the payroll.
Brazilian Social Security differs between three kinds of retirements paid by the INSS:
There are other social benefits provided by INSS, in case of accident, need for reclusion, disease and pensions.
Brazil has a very large young population, which from a demographic perspective is good for contributions. The down side is that life expectancy is increasing in Brazil which ultimately means the INSS will be having more taken out in pensions and social care than put in as tax creating a financial ‘black hole’.
In 2011, the institution collected BRL 254 billion while spent BRL 290,5 billion, effectively creating a deficit of BRL 36,5 billion, covered by the National Treasure.