The workplace in Spain will undergo significant transformations in 2025. The second vice president and Minister of Labor, Yolanda Díaz, has announced the progressive implementation of the working day of 37.5 hours per weekwith a maximum term until December of that year. However, not all the news will be positive. Starting in January, workers’ payrolls will reflect a salary reduction due to the adjustment of the Intergenerational Equity Mechanism (MEI), which will continue to increase as already occurred in 2024.
The MEI is a tax in the form of an additional contribution to the Social security within the payroll and also the contributions of the self-employed.
This is a measure implemented in 2023 to try to guarantee the public pension system given the increase in the number of pensioners and the upcoming retirement of the baby boomer generation.
What is the MEI for?
The difference with the rest of contributions within the payroll is that the MEI is a finalist quote. In other words, it does not give the right to any additional charge for those who contribute for it.
Thus, although workers pay more for their contributions, they will not see any increase in the benefits they receive. The MEI money will be used entirely to cover the imbalances in the public pensions.
How much will the MEI rise in 2025?
The MEI will increase 0.1 points in 2025 to reach 0.8% of the contribution base. That percentage is divided by the company and the workeralthough not 50%.
In 2025 the company will pay 0.67% for the MEI compared to 0.58% in 2024. For their part, employees will have an additional contribution of 0.13%, just 0.01 points more than in 2024.
How much will you stop earning through the MEI?
The MEI directly affects payroll. The percentage to pay is calculated on the contribution basis of the worker.
For example, an employee with a contribution base of 2,500 euros will pay 3.25 euros for the MEI compared to 3 euros this year.
Where can you check how much MEI payment
How can you know the impact of MEI on your payroll? To see the data you just have to check the “Social Security Contributions” section of the payroll, where the different social contributions.
The MEI does not have to appear separately, but is added to the common contingencies.
The MEI will continue to rise until 2029
The MEI began operating in 2023 and is expected to continue until 2025. In addition, its value will increase each year until 2029.
In 2025 it will rise in the same way as it did in 2024 and in the same way as it will in 2026. This is the proposed progression:
- 2025: the MEI will be 0.8%. The company will pay 0.65% and the worker 0.13%.
- 2026: the MEI will be 0.9%. The company will pay 0.75% and the worker 0.15%.
- 2027: the MEI will be 1%. The company will pay 0.83% and the worker 0.17%.
- 2028: the MEI will be 1.1%. The company will pay 0.92% and the worker 0.18%.
- 2029: the MEI will be 1.2%. The company will pay 1% and the worker 0.2%.
- From 2030 to 2050 the previous percentages will be maintained. The company will pay 1% and the worker 0.2%.
Other measures that will increase contributions in 2025
The MEI is the most general measure, but not the only one that will increase contributions and will make workers earn less.
In 2025 the solidarity feeaccording to which workers with salaries higher than the maximum base will have to pay an additional contribution.
Again, this is a contribution that does not include an increase in the maximum pension that you will receive, since that money will be used to pay for the pension system.
Specifically, this solidarity quota will mean a increase in contributions between 0.92% and 1.17%, which depends on the salary excess over the maximum contribution base.
In addition, it will increase by 0.25% each year until reaching a range between 5.5% and 7% in 2045.
To this we must add the update above the CPI of the maximum contribution base. Until 2050, the maximum bases will increase the CPI figure plus 1.2%, a percentage higher than what the maximum pensions will increase, which will rise only 0.115% more than the CPI.
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