The Hungarian Government supports a rise in the minimum wage for skilled workers in 2022 on the same scale as the over 19 per cent increase it backs for unskilled labourers, Budapest Business Journal reports.
The Innovation and Technology Ministry made the announcement in an October 20 statement, according to a report by state news wire MTI.
In the statement, State Secretary for Employment Policy Sándor Bodó said, "In another sign of esteem for workers, the government is proposing raising the minimum wage for skilled workers at a proportional rate to the increase in the minimum wage for unskilled labourers. Thus from January 1, 2022, [the minimum wage for skilled workers]...will rise to HUF 260,000 in a single step."
The government had previously announced its intention to raise the minimum wage for unskilled workers by over 19 per cent to HUF 200,000 per month from the start of next 2022. However, it acknowledged a tax cut would be necessary to counter the negative impact on businesses. At talks with the government a week earlier, unions and employers were reportedly at odds over whether the minimum wage for skilled workers should be raised at the same pace.
In his statement, Bodó reiterated the government's proposal to reduce employers' overall social security contributions by four percentage points from January 1, 2022, to compensate for raising the minimum wage.
The reduction in the payroll tax from 15.5 per cent to 11.5 per cent would save businesses around HUF 500 billion, Bodó said.
Initially, a 0.5 percentage point reduction in the payroll tax together with the elimination of the 1.5 per cent training contribution had been planned for next year.
A six-year agreement with employers and unions coupling minimum wage rises with payroll tax cuts is set to expire in 2022. Under that agreement, the minimum wage for unskilled workers rose from a gross monthly HUF 111,000 in 2016 to HUF 167,400 from February 2021. During the same period, the minimum wage for skilled labourers climbed from HUF 129,000 to HUF 219,000.
The payroll tax rate, meanwhile, was cut from 27 per cent to 15.5 per cent.
The minimum wage agreement has supported pronounced headline wage growth in Hungary.
Source: Budapest Business Journal
The Hungarian Government supports a rise in the minimum wage for skilled workers in 2022 on the same scale as the over 19 per cent increase it backs for unskilled labourers, Budapest Business Journal reports.
The Innovation and Technology Ministry made the announcement in an October 20 statement, according to a report by state news wire MTI.
In the statement, State Secretary for Employment Policy Sándor Bodó said, "In another sign of esteem for workers, the government is proposing raising the minimum wage for skilled workers at a proportional rate to the increase in the minimum wage for unskilled labourers. Thus from January 1, 2022, [the minimum wage for skilled workers]...will rise to HUF 260,000 in a single step."
The government had previously announced its intention to raise the minimum wage for unskilled workers by over 19 per cent to HUF 200,000 per month from the start of next 2022. However, it acknowledged a tax cut would be necessary to counter the negative impact on businesses. At talks with the government a week earlier, unions and employers were reportedly at odds over whether the minimum wage for skilled workers should be raised at the same pace.
In his statement, Bodó reiterated the government's proposal to reduce employers' overall social security contributions by four percentage points from January 1, 2022, to compensate for raising the minimum wage.
The reduction in the payroll tax from 15.5 per cent to 11.5 per cent would save businesses around HUF 500 billion, Bodó said.
Initially, a 0.5 percentage point reduction in the payroll tax together with the elimination of the 1.5 per cent training contribution had been planned for next year.
A six-year agreement with employers and unions coupling minimum wage rises with payroll tax cuts is set to expire in 2022. Under that agreement, the minimum wage for unskilled workers rose from a gross monthly HUF 111,000 in 2016 to HUF 167,400 from February 2021. During the same period, the minimum wage for skilled labourers climbed from HUF 129,000 to HUF 219,000.
The payroll tax rate, meanwhile, was cut from 27 per cent to 15.5 per cent.
The minimum wage agreement has supported pronounced headline wage growth in Hungary.
Source: Budapest Business Journal