Friday, 22 September 2023
PoliticsBudget Day plans: check here whether your purchasing power will increase in...

Budget Day plans: check here whether your purchasing power will increase in 2024

No billion-dollar package this year, no major intervention, but the outgoing cabinet is placing a clear emphasis in the Budget Memorandum with tax measures and allowances. Parents and children are best served.

In the corridors it is called a ‘purchasing power package’, a ‘budget’, because now that the cabinet is outgoing, no broad lines need to be drawn up anymore. Yet there is indeed a clear line in the national budget: citizens with children, including minimum income, will have the most extra to spend next year.

At the last minute, the government is mainly averting a further poverty trap. After all, it was a government promise that poverty would decrease during this government’s term of office, but that is just happening: a decrease of 1.3 percent becomes a fact.

Calculate your purchasing power for 2024 here

Please note: this tool shows the purchasing power change of common household types, not of personal situations. Does the module not display correctly? Then click here.

And on average, the Dutch person will gain 1.8 percent in purchasing power next year. Anyway, the average citizen does not exist, so if you look at the breakdown, you will see that mainly families and single parents benefit. Sometimes even with a 5.7 percent improvement in purchasing power. At the same time, there are groups whose purchasing power is declining. Single parents who do not work and AOW recipients without a partner make a loss, although without intervention they would have deteriorated even more.

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Although many politicians in The Hague want to get rid of the benefits system, it is still used to get the money to citizens. There is no better choice. That is why the rent allowance will be increased next year, by a maximum of 416 euros. And to help families, the child budget is also increasing: the maximum amount for the first child increases (by 750 euros), for subsequent children (plus 883 euros) and for children between 12 and 17 years old also (by 400 euros).

Not only allowances are tools for the cabinet, taxes are also used. One of the ways to help working people is to increase the earned income tax credit, a tax benefit for working people. This will be increased by 115 euros. In particular, households that earn between 25,000 and 44,000 have slightly more net left over.

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The other way around is also true: to help middle and lower incomes, higher incomes are more likely to pay the top rate of 49.5 percent. Every euro above the limit of 75,625 euros is taxed at 49.5 percent. Without intervention, the top rate would only be due from 80,263 euros. This measure yields more than 1.5 billion euros.


What everyone contributes to: the monthly health insurance premium will increase by an average of 12 euros next year. The government expects the new basic premium to be 1,792 euros, which amounts to almost 150 euros per month. These are averages: health insurers determine the amount of the premium themselves.

Another means to fill the treasury is more taxes on wealth. The tax-free allowance is normally adjusted (for example to inflation), but will remain 57,000 euros next year (and double for couples). You pay tax on every euro above this amount. The rate also increases from 32 percent to 34 percent. In other words: you will pay more tax on your savings sooner and more. Entrepreneurs will also suffer: the profit exemption for SMEs will be reduced from 14 percent to 12.7 percent.


And there are measures that ‘users’ will take. Beer and cigarettes are made more expensive. The tax on cigarettes will increase by 60 cents per pack: on average a pack will soon cost 10.70 euros. A pack of rolling tobacco will become considerably more expensive: 24.14 euros on average, due to an extra 3.60 euros in excise duty. And alcohol is also becoming more expensive, with the tax on it increasing by more than 16 percent.

The prices of traffic fines will also increase by 10 percent. For example, driving through a red light will cost 300 euros next year, and calling behind the wheel will cost 420 euros. The Ministry of Justice makes no secret of it: this is mainly intended to fill a hole in the treasury.

But, the government hasten to emphasize: the proceeds ultimately go to minimum income and middle incomes. The mantra for this Budget Day.

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