Published: November 17 2023
In Budapest, workers will see an increase in the minimum wage and benefits starting in 2024. This increase will have an impact on the income of nearly one million individuals and will also affect those who receive government support based on the minimum wage. In this article, we will explore the details of this wage increase and how it will affect different groups of workers.
Increase in Minimum Wage
Starting in December 2023, the minimum wage will be increased by 15%, from 232,000 forints to 266,800 forints. This increase will directly affect the income of workers earning the minimum wage and will result in higher wages for them.
Impact on Benefits
The increase in the minimum wage will also have an impact on various benefits and allowances tied to income. For example, the maximum amount for child care allowance and grandparental allowance will be determined based on the new minimum wage. Additionally, the maximum amount for certain benefits, such as sick leave and jobseeker's allowance, will also increase in line with the minimum wage.
The increase in the minimum wage will also have implications for other financial matters, such as loan eligibility. Some banks use the minimum wage as a benchmark for determining the minimum income required for loan applications. Therefore, individuals earning the minimum wage may have access to higher loan amounts.
The minimum wage increase in Budapest starting in 2024 will have significant implications for workers and their income. It will also impact various benefits and allowances tied to income. As the wage increase takes effect, workers can expect to see positive changes in their financial situation.
Questions & Answers
What is the minimum wage increase in Hungary? Starting from December 2023, the minimum wage and guaranteed minimum wage will increase by 15% and 10% respectively. The minimum wage will increase from 232,000 forints to 266,800 forints, while the guaranteed minimum wage will increase from 296,400 forints to 326,000 forints.
Who will benefit from the minimum wage increase in Hungary? The wage increase will directly affect the salaries of nearly one million people. Additionally, those who receive any form of support or benefits linked to the minimum wage will also see an increase in their income.
What benefits will increase as a result of the minimum wage increase in Hungary? Several benefits will increase, including the maximum amount of child care support (gyed) tied to the minimum wage. Starting from December 2023, eligible individuals can receive up to 373,520 forints. The upper limit for grandparental child care support (nagyszülői gyed) will also be the same. The maximum amount of parental leave support (gyed) for individuals in higher education or vocational training will be based on either 70% of the minimum wage or 70% of the guaranteed minimum wage, depending on the type of education.
How will unemployment benefits and sick leave payments increase in Hungary? The amount of unemployment benefits (álláskeresési járadék) and sick leave payments (táppénz) are also set to increase. The daily maximum amount of unemployment benefits cannot exceed the minimum wage, and in 2024, it will be 8,893 forints. The amount of sick leave payments is determined based on the length of continuous insurance coverage, with a minimum of 50% or 60% of the base. The maximum amount of sick leave payments will be tied to the minimum wage and will be 17,786 forints per day.
Will tax deductions increase as a result of the minimum wage increase in Hungary? Yes, individuals who qualify for specific tax deductions may see a slight increase in the deductions they are eligible for. For individuals with certain medical conditions or disabilities, such as diabetes, lactose intolerance, hearing or visual impairments, or mobility impairments, the deduction limit will be set at one-third of the minimum wage, rounded to the nearest hundred forints.
Will the amount of loans available for borrowing increase as a result of the minimum wage increase in Hungary? Yes, the minimum wage increase can have an impact on the amount of loans individuals are eligible to borrow. Some banks consider the minimum wage when determining the minimum income required for loan applications. Additionally, higher documented income can result in higher loan amounts, depending on the type and terms of the loan.
What are the maximum repayment amounts for personal loans based on the minimum wage in Hungary? For personal loans, the monthly repayment amount cannot exceed 50% of the net income for individuals earning the minimum wage. As of December, the maximum monthly repayment can be up to 88,700 forints for minimum wage earners and 108,400 forints for those earning the guaranteed minimum wage.