That the minimum wage must be updated to bring it as close as possible to the real cost of living is a matter of social justice, and that the PSOE and Sumar governments have done more to increase the minimum wage than the PP governments (which only raised it by 94 euros in seven years) is an easily verifiable objective truth. Rajoy left office in 2018 with a minimum wage of 735 euros, and this week the Sánchez government has raised it to 1,221. But then came Sánchez's demagoguery, cloaked in the guise of championing the poor: "It is unacceptable that, in a context of economic prosperity, the wages of those earning the minimum are scrutinized, while multimillion-euro profits are ignored." To begin with, there are around thirty companies with multimillion-euro profits in Spain, with the major banks leading the way. But among the rest, the vast majority are doing what they can, because profit margins have been shrinking and it's increasingly difficult, if not impossible, to compete on price with large corporations while complying with all labor and tax obligations. Lumping everyone together with the phrase "Corporate profit escalation" is like painting a broad, unflattering picture of the multitude of small and medium-sized business owners and entrepreneurs who are struggling to make ends meet at the end of the month.

The last time Pedro Sánchez ratified an increase in the national minimum wage (SMI) was in 2020, from the Moncloa Palace, following an agreement with the major unions, CCOO and UGT, and the Spanish employers' associations, CEOE and Cepyme. Six years later, Sánchez has once again presided over another minimum wage increase. This time, he did so from the Ministry of Labor, alongside the Minister, Yolanda Díaz (Sumar), and the two union leaders, Unai Sordo (CCOO) and Pepe Álvarez (UGT), but without the employers' associations, with whom Sánchez did not hesitate to distance himself. The Spanish president criticized the employers' associations for withdrawing from the agreement to raise the SMI to €1,221 per month by 2026. "Where are the employers?" the Spanish president asked this Monday at the signing ceremony for the new increase. "It is unacceptable that in a context of economic prosperity, those earning the minimum wage are scrutinized while those earning a lot of money are not," Sánchez said. On the eve of negotiations between unions and employers to update the current agreement for employment and collective bargaining (AENC), the Spanish president endorsed the position. "Pay them more!""From Joe Biden four years ago. "Let them pay more," he said. "Let no one tell us that salaries can't be raised when profits grow, when the economy is advancing," Sánchez reiterated.

The Ministry of Labor and the UGT and CCOO unions, but not the employers' associations, have agreed this Thursday to raise the minimum interprofessional wage (SMI). 1,221 euros gross in 14 paymentsThis represents a 3.1% increase compared to 2025. It's a rise of 37 euros per month, as announced by the Secretary of State for Labor, Joaquín Pérez Rey. The Council of Ministers will soon approve the salary increase, which will be retroactive to January 1st of this year. The employers' associations CEOE and Cepyme have distanced themselves from the agreement and rejected the increase, as anticipated in the statement released Thursday morning, in which they labeled the tax deduction in corporate income tax for the companies most affected by the pay increase as "deceptive" and "interventionist." According to the Ministry of Finance, the Ministry of Labor and the unions agree that this salary level will remain exempt from personal income tax.

The Ministry of Labor has offered social partners compensation for companies most affected by the minimum wage increase, but this is conditional on an increase in the lowest wages and maintaining current staffing levels. The ministry, headed by Yolanda Díaz, proposes a 3.1% increase in the minimum wage in 2021, to €1,221 per month (paid in fourteen installments), exempt from income tax. This was announced by the Secretary of State for Labor, Joaquín Pérez Rey, in a press conference following a nearly three-hour meeting with social partners. The Deputy Minister of Labor clarified that this compensation is not "a gift." urbi et orbi"To all companies, even those that are not affected by the minimum wage. Pérez Rey has not gone into detail about what this compensation would consist of "with respect" to the work that the Treasury is doing, since its design is still being defined, but he has admitted that one of the possibilities is to introduce a tax deduction in the corporate tax.

The Ministry of Labor has proposed a 3.1% increase in the national minimum wage (SMI) to social partners for 2026, maintaining this reference salary exempt from taxation. This would raise it from €1,184 to €1,221 gross per month, paid in 14 installments (an increase of €37). The Spanish employers' association and the major unions CCOO and UGT agreed to study the proposal, as explained at a press conference this Wednesday by the Secretary of State for Employment, Joaquín Pérez Rey, following the meeting between social partners to try to reach an agreement. The positions of the employers' and workers' representatives were quite far apart, as is usual when it comes to increasing the SMI. The unions wanted a 7.5% increase up to 1,273 euros per month, The employers' association CEOE lowered that figure to 1.5%.For its part, the committee of experts that advises the Spanish government In this matter, he proposed raising it by 37 euros per month (1,221 euros per month in 14 payments) by 2026 if it remained tax-exempt, or by 56 euros per month (up to 1,240 euros) if it were subject to income tax. Ultimately, the first option was chosen. Despite the disagreements between the different positions, after this latest meeting, Pérez Rey asserted that the dialogue between both parties was "sincere and very constructive." However, for now, neither unions nor employers have left the meeting with a yes or no to this proposal from the ministry led by Yolanda Díaz. The high-ranking official from the Ministry of Labor also expressed openness to "exploring" with the Treasury the possibility of "relaxing" the indexation rules related to the impact on public sector salaries. This was a recurring complaint from the employers' associations CEOE and Cepyme, who criticize the fact that with the latest increases in the minimum wage, it was necessary to update the bids in order to pass on this increase in labor costs to the administration, since they claim that this reduces the profitability of companies. The unions have also supported this review of prices in public contracts in line with any regulatory changes that may be approved, as outlined in the latest National Collective Bargaining Agreement (Agreement for Employment and Collective Bargaining, the state framework that serves as a guide in collective bargaining) approved in 2023. The Deputy Minister of Labor stated that it makes perfect sense that increases in the Minimum Wage (SMI) cannot be passed on to what companies charge the government for their services and mentioned sectors such as cleaning and private security, jobs with low wages closer to the minimum wage that have seen salary increases in recent years. "It's a matter of fairness," said the Deputy Minister. He also noted that the new European directive on minimum wages—which the Court of Justice of the European Union (CJEU) almost fully endorsed last November—already requires member states to incorporate it. [BK_SLT_LNA~ Exempt from Personal Income Tax]

Regarding the exemption of the minimum wage from income tax, Pérez Rey explained that this position was agreed upon with the Ministry of Finance, which will be responsible for the technical implementation of this measure. However, the Ministry of Labor is confident that the "2025 approach" will be followed and the tax relief will be presented in terms similar to those agreed upon last year. "The minimum wage cannot lose even a tenth of a percent of its purchasing power; those who earn it should not be the ones who pay taxes. Tax justice begins with those who have the most, not those who have the least," Pérez Rey emphasized. The Spanish minimum wage has been one of the flagship measures of the Spanish coalition government—first with the PSOE and Podemos, and now with the Socialists and Sumar—which has increased it by 61% since taking office. "It is the main antidote to inequality. This is an increase that makes the difference between decent wages and those that are not," the Secretary of State for Labor asserted. Following the meeting, Fernando Luján, Deputy General Secretary for Trade Union Policy at UGT, and Javier Pacheco, Secretary for Trade Union Action at CCOO, described Wednesday's meeting as "positive" and welcomed the Spanish government's willingness to relax the law on the de-indexation of public contracts. Pacheco noted that although their proposed increase to the minimum wage for 2026 was 7.5 percent, the union "will not obstruct" reaching an agreement that guarantees this benchmark will reach 60 percent of the average net Spanish salary. He also celebrated that the increase is above the projected inflation rate of 2.8 percent for 2025. "We are living in times that require us all to pull together to provide reassurance," Luján stated.

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To illustrate the financial obstacles, Artur Feijóo unfolds a chart. It shows the payment schedule for the subsidies received by TEB—the cooperative group he leads—to pay the salaries of the approximately 650 people with disabilities employed in its special work centers and the support staff who accompany them. He says they only just received 100% of the subsidies for 2024 this November, while for 2025 they have only received 15% so far. "We're at our limit," Feijóo admits. The delay in receiving these funds from the Generalitat (the regional government) has forced them to take out loans to pay salaries and cover the interest—between 60,000 and 70,000 euros—on these loans. If they manage to break even this year, it will be because the cooperative's members have made contributions to avoid losses. "We've been living in uncertainty for many years," Feijóo laments.

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In the last cabinet meeting of the year, the Spanish government approved the extension of a series of social and economic measures that will remain in effect through 2026. These measures will be outlined in two royal decree-laws that will now go to the Congress of Deputies for ratification. One royal decree-law covers the continuation of subsidies for public transport and the new single pass for travel throughout Spain, while the second will cover the social safety net, as well as other measures to be extended before December 31st, when they expire. These are the most noteworthy measures:

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The minimum wage, new bereavement and palliative care leave, and the crackdown on Uber Eats. These are the three issues that will shape the agenda of the Second Vice President and Minister of Labor, Yolanda Díaz, during the first weeks of 2026, at least in labor matters. This comes at a time of great weakness for the Spanish government due to... alleged cases of corruption and sexual and workplace harassment As the pressure mounts on Pedro Sánchez's inner circle, Díaz sees economic and social measures as the opening through which the government can find some breathing room. They also represent a way for the government to define its profile, especially given the upcoming regional elections – beginning with Aragon on February 8th.

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The Ministry of Labor is paving the way for an increase in the national minimum wage (SMI) by 2026. In the first meeting with the major unions, CCOO and UGT, and the Spanish employers' association CEOE, held this Tuesday afternoon, Yolanda Díaz's team sought to gauge the social partners' interest in raising the SMI by 2026. Sources from the Ministry of Labor explained that the meeting served to convey to the social partners the report from the committee of experts, which recommended a 3.1% increase without taxation and a 4.7% increase if income tax is paid. committee of experts It falls short of the unions' proposals and also deviates from the employers' proposal, which called for a 1.5% increase. However, this increase would mean that recipients of this minimum income would not be subject to income tax. Following this initial contact, the central government must make a first proposal on the minimum wage for 2026, with the aim of reaching an agreement within the framework of social dialogue. The unions expressed their openness to negotiation, while the CEOE (Spanish Confederation of Employers' Organizations) did not comment. Maximum tension

The negotiations are taking place at a time of maximum tension between employers and the Ministry of Labor. In fact, sources involved in the social dialogue assume that any agreement reached will be bipartite (government and unions), and that employers are unlikely to join. This Monday, the CEOE (Spanish Confederation of Employers' Organizations) was no longer part of the agreement to pass the new leave for bereavement and palliative care.

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Negotiations for a new increase in the minimum interprofessional wage (SMI) will begin without internal disagreements within the Spanish government, especially regarding the affected ministries: Economy, Finance and Labor. portfolios that have previously been involved in more than one clash regarding the measure

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The committee of experts advising the Spanish government on the national minimum wage (SMI) has proposed raising it by 2026 to €37 per month (€1,221 per month in 14 payments) if it is decided that it will remain exempt from income tax, or to €56 per month (to €40 per month) if it is decided that it will remain exempt from income tax, as announced this Thursday. The Country and has been confirmed by ARA. Currently, the minimum wage is set at €1,184 per month, paid in 14 installments.

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The employers' associations CEOE and Cepyme agreed on Tuesday to propose a 1.5% increase in the national minimum wage (SMI) by 2026, which would bring it to €1,202 gross per month, paid in 14 monthly installments (€16,824 gross annually). The organizations stated that this increase is in line with the planned raise for public sector employees next year and coincides "with the objectives of the European minimum wage directive." A few weeks ago The CCOO and UGT unions proposed raising the minimum wage by 7.5%....up to €1,273 gross per month, and to include income tax (IRPF) for the first time. Meanwhile, the committee of experts convened by the Ministry of Labor has not yet submitted its proposal. According to a statement released by employers, data from the Active Population Survey (EPA) shows that the minimum wage (SMI) has already exceeded 60% of the average net salary used by the Ministry, headed by Yolanda Díaz, as the criterion for setting it. "CEOE and Cepyme use the EPA as a reference because the Wage Structure Survey (EES), which serves as the basis for calculating the average salary for the group of experts advising the Ministry of Labor, does not include wages in agriculture, livestock farming, fishing, or domestic service, among others, which creates... "These sectors are heavily reliant on labor and concentrate a large part of the minimum wage, so the average salary resulting from the Wage Structure Survey is higher than the actual figure, and the resulting minimum wage is oversized," the employers' associations argued. In their view, the latest minimum wage increases are "penalizing employment" in these sectors. According to their calculations, using the EPA (Active Population Survey) data for 2025 as a reference, the minimum wage would be €15,760 gross per year, €816 less per year. "In other words, the minimum wage is currently 4.9% higher than it should be," the employers' associations CEOE and Cepyme stated. In fact, they believe the minimum wage should not be increased next year, but they propose a 1.5% increase because it aligns with the planned increase for civil servants and the objectives of the European directive for setting the minimum wage. "Precisely to respect collective bargaining, we are conditioning this 1.5% increase on..." "Compliance with the absorption and compensation rules of the Workers' Statute," they say.

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The two largest unions are making moves in preparation for an increase in the national minimum wage (SMI) in 2026. CCOO and UGT have formalized their proposal for negotiations with the Spanish government and employers: a 7.5% increase in the SMI, to €1,273 gross per month. This increase represents an €89 raise over the current minimum wage, which stands at €1,184 gross per month paid in fourteen installments, as detailed by Javier Pacheco, Secretary of Union Action for CCOO, and Fernando Luján, Secretary General of Union Policy for UGT, at a press conference this Tuesday. Both union representatives argued that the SMI increase for 2026 must be "substantial and substantial." According to the unions, despite being subject to income tax (IRPF), with a 7.5% increase, those receiving the minimum wage would still earn the equivalent of 60% of the average net salary, which is the benchmark established by the European Social Charter and the commitment of the Spanish government. "We say that 60% should be calculated on gross salaries [...]. This 7.5% increase is less than how business profit margins have increased this year," Luján argued. The income tax (IRPF) already dictated the 2025 increase. While the Minister of Labor, Yolanda Díaz, rejected the idea of the minimum wage being taxed under this levy, the Ministry of Finance, headed by María Jesús Montero, defended it. Ultimately, the battle ended with a deduction for minimum wage earners so they wouldn't have to pay income tax. Looking ahead to 2026, Díaz has asked the committee of experts on the minimum wage to put forward two proposals: one for an increase subject to income tax (IRPF), and another in which minimum wage earners remain exempt from this tax. However, the committee has not yet released its proposal. Díaz asserted this Tuesday that the minimum wage will increase "significantly" in 2026 if the Spanish government, or "a part of it"—referring to the Treasury—decides that it will be subject to income tax (IRPF).

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Second Vice President and Minister of Labor, Yolanda Díaz (Sumar), has asked the committee of experts on the minimum interprofessional wage (SMI) to propose two different increases for 2026: one that does not include personal income tax, and another that does take this tax into account. In this way, Díaz avoids the clash that arose with the Ministry of Finance over the 2025 increase. The head of this ministry, María Jesús Montero (PSOE), suggested that with the latest approved increase, recipients of that income should already be taxed, something the ministerial team argued. Finally, the battle ended with a deduction for SMI recipients so they wouldn't pay personal income tax.

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Inflation in the years immediately following the pandemic eroded household purchasing power, and in most advanced economies, wages have yet to recover. According to a report by the Organization for Economic Cooperation and Development (OECD, the umbrella organization of the world's major developed economies), by the third quarter of last year, wages had recovered to the purchasing power they had in 2020 in only 12 of the 33 most advanced countries.

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Together with the PSOE registered at the beginning of March the law that should allow the State to delegate immigration powers to CataloniaBoth groups appealed to Article 150.2 of the Constitution to implement one of the demands of Carles Puigdemont's party to continue shoring up the governability of the State. Now it is ERC (Republican Left) that also wants to invoke this constitutional precept, but in this case so that Catalonia can regulate its own minimum wage. The Republicans, in fact, have already set a figure: they want it to be raised to 1,420 euros – currently 1,184 euros across the State. The path they propose should be accompanied, argues ERC, by a change to the Workers' Statute, specifically Article 27, which specifies that it is the state government that has the power to set its figure.

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White smoke. The Minister of Labor, Yolanda Díaz (Sumar), and the Minister of Finance (PSOE), María Jesús Montero, have reached an agreement to adapt personal income tax (IRPF) for workers earning the minimum interprofessional wage (SMI) in 2025, as announced by the Ministry of Labor and confirmed by the Treasury. Finally, minimum wage earners who were affected by this tax (20% of the total) will be able to benefit from a "specific deduction" that will prevent them from having to pay personal income tax. According to the Treasury, this will have an impact of approximately 200 million euros.

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Both partners in the Spanish government, the PSOE (Spanish Socialist Workers' Party) and Sumar (Sumar), are seeking a way to prevent workers earning the minimum wage (SMI) from having to pay personal income tax. The Minister of Finance, María Jesús Montero (PSOE), and the Minister of Labor, Yolanda Díaz (Sumar), are continuing negotiations to reach an understanding on an issue that has been one of the most tense clashes of the year. evidenced in a press conference following a cabinet meeting"He is confident of reaching an agreement in the coming days," Montero confirmed at a press conference this Thursday.

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I am stunned by this debate between the PSOE, which raised the minimum interprofessional wage by 61%, and its partners at Sumar, who are against this increase having the retention of personal income tax. ApparentlyThe brilliant Ot Serra and Andrea Zamorano explained it to us at the ARA–, it seems that every year, when the minimum wage is proposed, there is a "political agreement" so that it does not reach the new threshold and does not pay taxes, but this time "the Treasury has opted for the right". The leader of the PP has said: "Keeping half of the increase in the SMI is neither progressive nor social justice".

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The decision to tax the minimum interprofessional salary (SMI) by personal income tax has led to a Political clash between PSOE and Sumar. But what are they arguing about? At the end of January, the Minister of Labor, Yolanda Díaz, announced a 50 euro increase in the minimum wage per month. In this way, it went from 1,134 euros per month in 2024 to 1,184 this year – over 14 payments – after reaching an agreement with the majority unions, CCOO and UGT, which did not have the approval of the CEOE employers' association. However, this increase has not been the point of tension. The discussion comes from the refusal of María Jesús Montero, Minister of Labor, not to raise the minimum exempt from personal income tax so that those who earn the minimum wage are exempt.

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