MEI: The new tax you will pay from this month

Whether you are self-employed or an employee, you have to make a payment. New tax from 2023. about her Intergenerational Equality Mechanism (MEI)a new tax they will have to pay, from this year 2023all registered workers, Social Security and what it will mean salary percentage. A measure affecting more than 20 million Spanish citizens.

What is MEI? New tax coming in 2023

The Intergenerational Equality Mechanism replaces the old Sustainability Factor and is contingent and temporary. this tax aims to recharge. retirement piggy bank through the balanced distribution of effort to finance pensions between generations.

With Rapidly increasing levels of aging population, current unemployment, baby boomer retirement and the pension reserve fund is almost empty, the Government awaits its arrival Very difficult times for retirement.

Therefore, in addition to other measures that include pension reformThe MEI published in . BOE last December this mechanism acts on income (contributions) rather than benefits (expenses) how the repealed Sustainability Factor behaves. Unlike the latter, which calculates benefits based on increased lifespan, The Intergenerational Equality Mechanism will only be activated when necessary and on a temporary basis.

What will the new tax of the Intergenerational Equity Mechanism look like?

It will not affect future MEI pensions in January 2023, therefore, their amount will not be reduced, unlike the abolished Sustainability Factor. about one new tax to be borne by all workers whatever your income. So, The salary percentage will be the same for everyone.

This new tax will be implemented as a new contribution concept, Thus, people registered with SGK they will see their payroll decrease by 0.6%. This additional fee in the quote It will put pressure on the self-employment quota as well as on the payroll of workers.

In this way, the Government wants to raise enough money to cover the cost of future pensions. Specifically, it is aimed to raise around 22,000 million euros by 2032, when this new tax scheme is expected to end.

How will the new tax affect you?

0.6% will be deducted from workers’ salary to pay this new tax, which will come into effect on January 1, 2023. Employers will pay 0.5% of this amount and workers will pay the remaining 0.1%. In the case of self-employed unions, the unions calculate that the average pay will be around 5 euros per month.

Speaking of numbers, for example, for workers with a gross salary of 2,000 euros, the new tax amounts to 12 euros per month, of which 10 euros is paid by the company and 2 euros by the employee.

Source: Informacion


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