Justice Ministry plans to reduce debt collection garnishment rate

The Justice Ministry intends to amend the Enforcement Proceedings Code to reduce the portion of a debtor's income that can be garnished to satisfy debt. According to the ministry, this will incentivize debtors to work officially and not conceal their income.

The Justice Ministry is developing amendments to the Enforcement Proceedings Code that would reduce the portion of a debtor's income that can be garnished to cover debt. The bill aims to better balance the interests of creditors and debtors than the current regulations do.

According to the ministry's assessment, the change will also have broader economic impact: if garnishment possibilities decrease, debtors will have greater incentive to work officially and not conceal their income. This in turn simplifies debt collection, as officially declared income is easier to garnish than concealed earnings.

In addition, the ministry emphasizes that the change will improve debtor protection. Currently, an excessively high garnishment rate can leave a person below the subsistence minimum, which contradicts the principle that everyone must retain sufficient resources to live on. The proposed reform seeks to strike a balance that does not harm a debtor's ability to provide for themselves, while at the same time promoting honest and transparent employment relationships.