Overview of 2024 Fiscal Adjustments
The year opens with several pension, VAT, and wage measures staying favorable for some foods, utilities, and living costs. There is ongoing discussion about updates to the interprofessional minimum wage, with decisions anticipated within the year.
Below are key changes that may influence everyday expenses at the start of 2024.
Pension
Pensions are revalued at 3.8 percent to align with recent inflation indicators spanning December 2022 through November 2023. Premium and passive pension groups see upward adjustments, while special increases apply to minimum and non-contributory pensions, including benefits for survivors. The widow’s pension, when combined with family responsibilities, rises to match the minimum pension level for dependents, marking a notable 14.1 percent boost.
Non-contributory old-age and disability pensions also rise by 6.9 percent, reaching 517.9 euros per month in 2024.
Minimum Income Supports
The minimum vital income will increase by 6.9 percent to reflect broader wage trends. Depending on household composition and the number of dependent minors, a supplementary payment of up to 604.38 euros monthly may be needed.
Minimum Wage
The interprofessional minimum wage remains potentially frozen at the outset, awaiting a final agreement between the labor ministry and social partners. The 2023 level stood at 1,080 euros per month, with retroactive application possible from January 1. Proposals show a range from a 3 percent employer contribution to a 4 percent government contribution, with unions seeking around 5 percent. Final approval will hinge on the negotiated deal.
Contributions
The base for mandatory contributions stays at 1,260 euros and will move in step with the SMI. The maximum contribution base rises 5 percent to 4,720.5 euros per month, reflecting both the 3.8 percent pension rise and an additional 1.2 percent for higher salary brackets as part of reform. An intergenerational equality adjustment brings the MEI rate to 0.70 percent in 2024, with 0.58 percent borne by employers and 0.12 percent by employees.
Public Sector Salary
Civil servant pay, previously paused, is set to increase in line with the public sector agreement. The 2024 budget includes a 2 percent fixed raise and a 0.5 percent variable increase if the harmonized CPI from 2022 to 2024 exceeds 8 percent. Once approved, the raise is expected to be retroactive to January 1.
Food VAT
Fundamental foods continue to benefit from VAT relief through mid-year. Basic staples such as bread, milk, cheese, eggs, fruits, vegetables, legumes, tubers, and grains maintain 0 percent VAT, while pasta and oils face a 5 percent rate during the first half of the year.
Butane
Butane cylinder prices stay at 15.14 euros in early 2024, as confirmed in the latest review. Prices can still be revised mid-month, with a cap at 19.55 euros per cylinder through June 30 under ongoing government extensions.
Electricity
The new PVPC tariff remains uncertain, but the market is expected to gain more stability over time. The index starts on January 1, with OMIP projections showing around 80.9 euros for January, about 75 euros for Q1, and roughly 80.4 euros for the full year. VAT on electricity rises from 5 percent to 10 percent in 2024, yet this increase is cushioned by electricity charges running well below pre-war levels.
Gas
Natural gas VAT sits at 10 percent for the first quarter. The reviewed rate indicates a TUR increase near 8.19 percent from January 1, constrained by a 15 percent cap on raw material costs to limit sharp spikes.
Telecommunications
Movistar plans a rate rise of one to three euros per month from January 15 for most customers. Vodafone targets a 4.38 percent increase in the first quarter, averaging around 1.64 euros more per month. Earlier in 2023, several providers raised prices more aggressively. Orange and MásMóvil have indicated no changes for now, while Digi has ruled out new increases.
Fuels
From January 1, professional transport fuel bonuses disappear. The diesel subsidy ends at five cents per liter. The program began in April 2022 with 20 cents per liter and was reduced gradually in 2023, with extensions for transporters where needed.
Transport
Public transport subsidies continue. When municipalities and councils meet a 50 percent participation threshold, metro and city bus travel discounts reach 30 percent. State-run suburban and medium-distance rail will be free for frequent travelers in 2024, with half-price fares on high-speed and Avant services. The same arrangements apply to state bus lines.
Public Transport Subsidy and Tolls
Highway tolls rise in 2024 by 5 to 6.65 percent, depending on concession terms. If annual supports are not renewed, tolls could climb beyond 8.5 percent. Postal tariffs increase on January 1, with a standard national letter up to 30 grams rising by 4 euro cents to 0.82 euros.
These measures reflect a broader trend in living costs and government support that may influence households across Canada and the United States monitoring international fiscal policy and consumer prices. The overview focuses on how such policy changes might affect cross-border trade, investment decisions, and personal budgets for North American readers. While the summary highlights key updates, readers should watch official government communications for the latest figures.
Notes indicate that figures may be adjusted following legislative actions. Readers are encouraged to review official releases and trusted briefings for the most current data. This summary aims to provide a clear, easy-to-follow picture of European fiscal policy movements and their potential implications beyond borders.