2025 will be a key year for workers. First, due to the entry into force of the reduction of the working day to 37.5 hours per week (the deadline will be until December 31 of next year), but also due to the reform of severance pay, the remuneration of leave parental leave, the possible extension of leave for birth and care of a minor or the increase in the Minimum Interprofessional Wage, which has already been confirmed.
Focusing on this last aspect, salaries, there is an aspect that many workers may be unaware of. And it is that Your payroll will be “cut” by the Intergenerational Equity Mechanism (MEI). With the pension reform of the then Minister of Social Security, José Luis Escrivá, this mechanism better known as the “pension tax” was introduced.
It began to be applied in 2023 and, as approved in the reform, Your tax increases progressively year by year. In this way it will rise again in 2025 and, although it is known as a tax, it is really an additional (and mandatory) contribution that we contribute to Social Security with the aim of reinforcing the so-called “pension piggy bank”. Especially taking into account that we must face the pensions of the ‘baby boom’ generation.
How much will the MEI rise in 2025
The Intergenerational Equity Mechanism is included in Law 21/2021 to guarantee the purchasing power of pensions and other measures to reinforce the financial and social sustainability of the public pension system, which can be consulted in this Official State Gazette ( BOE). In this, it was established that, starting in 2023, and over a period of 10 years, An additional final contribution would be set to nourish the Social Security Reserve Fund.
In this way, the price of the MEI It will be maintained until 2032. When this year arrives, it will be reviewed whether the collection objective has been met, and from there it will be decided to continue with it until 2050 or eliminate it. Taking into account this annual evolution, This is what the MEI will raise in 2025 and in the coming years:
- 2025: 0.80% (0.67% for the company and 0.13% for the worker).
- 2026: 0.90% (0.75% for the company and 0.15% for the worker).
- 2027: 1% (0.83% for the company and 0.17% for the worker).
- 2028: 1.10% (0.92% for the company and 0.18% for the worker).
- 2029: 1.20% (1% the company and 0.2% the worker). The latter would be maintained until the aforementioned review.
Regarding its impact on the payroll, the Organization of Consumers and Users (OCU) explained at the beginning of the year that the final cost of the MEI varies depending on the contribution base of each worker. Thus, “the percentage of the MEI that corresponds to the worker plus the type of contribution is multiplied by the contribution base for common contingencies in each payroll”, this result being the one that “is deducted from the salary to be received by the worker.” This year, 2024, when it was at 0.70%, it meant a monthly discount of 3 euros on each payroll.
How to find the MEI on the payroll
Since the MEI is a deduction, it is found in the “deductions” section of the payroll, with the rest of the contributions we make to Social Security.