More tax credits for working people by 2023
If it is up to the cabinet, as of 2023 there will be a tax credit for working people with a low income. It concerns an increase of the employment tax credit for this group.
This year, working people with lower incomes will have less purchasing power. To give these people some more financial leeway, the government wants to increase the employment tax credit for this group as of 2023. As a result, they should have a bit more net income next year. The amount of the tax credit depends on the age and the amount of the earned income of the working taxpayer. If this income does not exceed € 36,649 (2022), the employment tax credit is at least the employment tax credit applied by the employer for the payroll taxes, but at most the amount that corresponds to the year of birth of the taxpayer. The maximum employment tax credit is now € 4,260.
𝗣𝗮𝗿𝘁-𝘁𝗶𝗺𝗲𝗿𝘀 𝗺𝘂𝘀𝘁 𝘄𝗼𝗿𝗸 𝗺𝗼𝗿𝗲
With this measure, the cabinet also wants to encourage part-timers to work more hours. This should help to solve the personnel shortage. Earlier research shows that 30% of the working population would like to work more hours if the employment tax credit is increased. In addition, the government wants to raise the minimum wage even more than previously planned. This will also have to lead to an increase in the purchasing power of the lowest incomes. The parties had thus already decided to increase the minimum wage, but even with that increase it remains below the European directive.
𝗠𝗲𝗮𝘀𝘂𝗿𝗲𝘀 𝘁𝗼 𝗯𝗲 𝗱𝗲𝗰𝗶𝗱𝗲𝗱 𝗶𝗻 𝗔𝘂𝗴𝘂𝘀𝘁
The financing of the measures must come from the revenues announced in the Spring Memorandum. The decision on whether to proceed with all these measures will be made in August.
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