Spanish social insurance contributions exacerbate inequality and distort income distribution. One of the main causes of this effect is the existence of maximum and minimum limits on the contribution base. Therefore, the main objective of this paper is to analyze the regressivity of employees’ social insurance contributions to the Spanish General Social Insurance Scheme and the resulting worsening of income inequality, with a view to proposing solutions to mitigate this effect. By comparing with the Social Insurance systems of other European countries, three reforms are simulated using EUROMOD: the removal of maximum and minimum contribution bases, and the introduction of two contribution deduction for low-income workers. The results show that these measures reduce regressivity, improve income distribution and increase tax revenue. In this way, greater equity in the social insurance system is promoted.
