In 2024, some citizens in Germany will experience a reduction in their salaries. The federal government plans to introduce certain changes in insurance and tax policies, which will particularly impact certain Germans.
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Starting next year, many will have even more deductions from their salaries. Consequently, these individuals will receive even less take-home pay.
For these employees, salaries will decrease in 2024
The reduction in net incomes in 2024 will be attributed to limits on social insurance contributions.
These limits are set by the federal government each year, and an increase is planned for 2024. As a result, some employees will receive less money.
Workers whose income is below the maximum limit pay social security contributions on their entire gross income. Employers deduct the contributions directly from the payroll fund.
The Federal Ministry of Labour has already presented a project to adjust contribution limits. These limits determine the gross salary up to which employees must pay social security contributions. Employees whose salary exceeds the contribution limit will be required to pay.
For 2024, specific contribution limits are planned in West Germany:
- For pension insurance, it will be €7,550 per month (for miners, it will be €9,300 per month);
- Unemployment insurance will be €7,550.
For East Germany in 2024, the limits vary slightly:
- The pension insurance limit is €7,450 per month (for miners, €9,200);
- The unemployment insurance limit is €7,450 per month.
There will also be an adjustment to the mandatory health insurance contribution limit. As of January 1, this amount is set to be €5,175 nationwide. Those exceeding this limit will pay higher contributions.
Additionally, the limit for mandatory insurance has been increased. Anyone whose salary surpasses this threshold has the option to secure private health insurance. The limit for mandatory health insurance will be €69,300 per month.
Based on these changes, it can be inferred that certain groups of citizens will have to contribute more. This, in turn, will impact the net income level, which may ultimately decrease.
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These changes in insurance and tax policies will lead to a decrease in salaries for several individuals in Germany in 2024. Specifically, the planned limits on social insurance contributions will result in reduced take-home pay for many workers.
