Pensioner According to the Finnish Taxpayers Association, the purchasing power of Finnish citizens will increase significantly in 2024.
Pensions jumped at the beginning of the year as a result of increases in the national pension, guaranteed pension and earnings-related pension based on the 2023 inflation rate. National pension and security pension will increase by 5.9% in proportion to income. Pensions decreased by 5.7% from the previous year.
The taxation of pensions has also changed, with higher tax rates for low and high pensions and lower tax rates for medium pensions. This adjustment is not as large as the index-based pension increase and means that the net income of all pensioners increases.
At the same time, inflation is expected to subside, so the purchasing power of a pensioner receiving 922 euros per month will be 3.8%, the purchasing power of a pensioner receiving 1,881 euros per month will be 4.2%, and the purchasing power of a pensioner receiving 5,643 euros per month will be 3.8%. It will improve by 2.8%. According to the Taxpayers Association’s calculations, cents.
For example, the Treasury expects inflation to slow to around 2% in 2024.
Therefore, the purchasing power of pensioners is expected to increase significantly more than that of the national economy as a whole. The Ministry of Finance has announced that the gross domestic product (GDP) growth rate in 2024 is expected to remain at 0.7%.
This year will be a boon for pensioners, but will largely make up for the slowdown in pension development over the past four years.
Calculations by the Taxpayers Association show that since 2019, the purchasing power of only pensioners with a monthly income of less than 1,000 euros has increased by 4.5%. In contrast, the purchasing power of middle- and high-income pensioners is projected to return to 2019 levels in 2024.
Aleksi Teivainen – HT