The Council of Ministers has approved “a special Spring Memorandum”. The coalition parties have been discussing it for weeks. In April it turned out that many plans of the cabinet that took office in January had to be adjusted again, because major setbacks appeared. These had to do with, among other things, the war in Ukraine.
Much was already clear. For example, it came out this week that the cabinet already wants to start with the raising the minimum wage† The original idea was to raise wages by 7.5 percent from 2024 in two steps. In the end, however, it was agreed that work would start in 2023 and that the increase would be spread out over three years.
It was not yet known whether the state pension would also increase by 7.5 percent. That now appears to be the case. Here too, a choice has been made for an increase in three steps: in 2023, 2024 and in 2025.
More money for Defense
It was also certain that more money will go to defense. The cabinet now states that in 2024 and 2025 it wants to meet the NATO standard of spending 2 percent of gross domestic product on the armed forces. The Netherlands has been far below this for years. This means that “several billions” will be added for defense in the coming years, said Finance Minister Kaag after the Council of Ministers.
On the other hand, the cabinet wants to allocate more than 2 billion euros less for funds for the climate, nitrogen and investments in infrastructure, research and innovation, among other things. The ambition to solve “major social problems” remains intact. Millions are still going to the funds, because “these investments are necessary to prevent even higher costs in the future for future generations”, says the cabinet.
In addition, all kinds of intended tax benefits apply companies and people with wealth not trough. The corporate tax and the tax on capital in boxes 2 and 3 will increase. This also ensures that the extra expenses are covered.
Energy and food prices
In April it turned out that many plans from the government’s coalition agreement had to be adjusted. There had to 10 to 15 billion euros had to be found due to unforeseen events, in particular the war in Ukraine. As a result, energy and food prices rose and the purchasing power of low and middle incomes in particular fell.
In recent weeks, there have also been talks with opposition parties, because the coalition does not have a majority in the Senate. Kaag said after the Council of Ministers that she hopes that the discussion in the House of Representatives can be continued and “that we will be able to create broader support, because that is very much needed”.
From decision of the Supreme Court The fact that people who have made no objection to the savings tax too late or who have not objected do not have to be compensated has no consequences for the Spring Bill. State Secretary Van Rij previously announced that there are 2.8 billion euros is set aside to compensate the approximately 60,000 people who did object and were proved right.
The deficit in the national budget is 3.4 percent of the gross domestic product in the Spring Memorandum. According to the rules of the euro countries, this may actually be no more than 3 percent, but in practice this is treated generously.
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