Left-wing parties want to increase minimum wage more to compensate for inflation

GroenLinks and PvdA want to increase the minimum wage and the related benefits by an additional 6.5 percent. That should compensate low-income people for all the price increases since January 2020. The left-wing parties want to collect the billions needed for this measure from companies that make “exorbitant profits” and from shareholders.

The parties will present their proposal on the same day that several large companies will explain to parliament why their wages are rising less quickly than profits and shareholder payouts. Ahold Dehlaize, Heineken, and KPN, among others, have been invited to this round table discussion, as have employers’ organization VNO-NCW and the trade unions FNV and CNV.

The left-wing opposition parties believe the Cabinet is doing too little against “grabflation.” They point to research by Rabobank that showed that the prices paid by consumers in the store had risen faster than companies’ purchase prices. As a result, some companies make more profit. They often use it to reward shareholders, for example, by buying back their own shares.

“The Cabinet promised to halve poverty, but what is happening? Hundreds of thousands more people in poverty, while companies are making record profit after record profit,” said GroenLinks leader Jesse Klaver.

According to PvdA leader Attje Kuiken, the Cabinet is afraid to tackle companies. “With this proposal, we move the money from the shareholder to the stock filler.”

The parties propose to levy a once-off tax of 50 percent next year on excessive profits from 10 million euros, good for 4 billion euros in extra income. A permanent increase in the top corporate income tax rate, from 25.8 to 30 percent, should yield an additional 3.7 billion euros on a structural basis. A tax on share buybacks should raise another 400 million euros.