In March 2022, the OGBL refused to sign a tripartite agreement that manipulated the index by introducing a delay of at least 12 months between two index brackets and that did nothing to combat the explosion in prices.

After months of lobbying, the OGBL was finally able to secure a new tripartite agreement for September 2022, restoring the normal operation of the index and introducing anti-inflationary measures, particularly for energy prices.

The new tripartite agreement, reached at the end of the day on March 3 and signed on March 7, 2023, consolidates the September agreement and even strengthens it on several points.

Index and energy price caps

• The agreement guarantees the normal operation of the index until the end of 2024. There will be no manipulation and no new tranche deferrals. Given the employers’ persistent attacks on the index in the run-up to the tripartite meeting, this is another success for the OGBL’s consistent action in defense of the index.
• Compensation to employers for the possible indexation tranche announced for the fourth quarter of 2023 – provided for in the September agreement – will be provided through the Employers’ Mutual Fund and will end in January 2024. In this way, it has been possible to avoid the logic of a permanent state subsidy of wage increases. It should be noted that employees and pensioners will receive the full amount of this tranche when it becomes due.
• Measures to cap energy prices (electricity, gas, fuel oil, pellets, etc.) will be extended until December 31, 2024. This is an important measure to avoid another inflationary shock in 2024. This measure provides security for consumers, who will be spared any major increases in their energy bills.

A first step towards greater tax justice

At the insistence of the syndicates, the issue of adjusting the tax scale was included on the tripartite agenda at the last minute, despite the opposition of the employers.

What’s more, the tripartite negotiations resulted in a first adjustment of the scale, which will take place in two stages:

In 2023, taxpayers will receive a tax credit equal to the impact of two index brackets on their personal taxation. This credit will be applied as soon as the tripartite law is adopted, with retroactive effect from January 1, 2023.

As of January 1, 2024, the tax scale will be increased by 6.37%, equivalent to 2.5 index brackets.

This is an important first step to put an end to the phenomenon of cold progression. However, the OGBL maintains its demand for an adjustment that takes into account all the increases applied since 2017, as well as the reintroduction of a mechanism for the automatic adjustment of the tax scale to inflation. These elements must be the subject of a comprehensive tax reform, the main objective of which must be greater tax justice.

Housing and climate measures

In addition to the two main points concerning the index and the tax scale, the Tripartite also adopted a series of more specific measures, in particular to provide additional support in the context of the housing crisis and the ecological transition. To name but a few:

• the “bëllegen Akt” tax credit for notarized deeds for home purchases was increased from €20,000 to €30,000
• against the backdrop of sharply rising interest rates, the ceiling for mortgage interest deductions has been raised by 50%.
• tax exemption for individuals on energy generated by photovoltaic panels will be increased
• compensation for the CO2 tax will be extended in the form of a new, permanent climate tax credit.
• the government will continue to cover the additional cost of energy to limit price increases in nursing homes.
• an equivalent tax credit of 84 euros will be paid to REVIS and income for the severely disabled (revenu pour personnes gravement handicapées – RPGH) recipients until December 31, 2024.

For the OGBL, the new tripartite agreement strengthens the purchasing power of households without adversely affecting employees and pensioners. Attacks on the index have once again been postponed. The OGBL can therefore support the new tripartite agreement, which would certainly not have been possible without its constant commitment to the purchasing power of the people, the defense of the index and the adjustment of the tax scale to inflation.

Published by the OGBL on March 7, 2023