HUF 200,000 might be the new general gross minimum wage from 2022 in Hungary. Informal consultation between the Government and the National Association of Entrepreneurs and Employers has already begun with regard to a new, long-term agreement on minimal wages. The official negotiation process should also be started by 15 September 2021.
According to the initial comments from the parties involved, it is expected that the gross general minimum wage would be increased to HUF 200,000 (per month), while for more qualified positions (jobs requiring at least a secondary education or a secondary vocational qualification) the so-called guaranteed wage minimum would reach gross HUF 260,000 (per month). In both cases this would mean an increase of 19%.
The employees are expected to be compensated for the material increase with a similarly material decrease of tax burden on wages. The details of an eventual tax reduction are not yet communicated, however, in 2016, when the last similarly significant, long-term minimum wage programme had been concluded, the social contribution tax was cut by 5% as well.
By Balint Zsoldos, Head of Tax, KCG Partners Law Firm