BRUSSELS, BELGIUM / EuroWire / — Belgium’s Federal Parliament has approved a broad package of fiscal, wage-indexation and pension measures, moving ahead with changes to automatic income adjustments while inflation remains elevated. The vote, completed late Thursday after months of debate, covers the new centenindex system, pension changes and tax measures included in a programme law. The package modifies how some wages, pensions and benefits are adjusted when inflation triggers Belgium’s indexation mechanism.
The central wage measure changes Belgium’s automatic indexation system, which links wages, pensions and benefits to price developments. Under the approved rules, future index-linked increases will be fully applied only to the first 4,000 euros of gross monthly salary. For pensions and benefits, the full indexation limit is 2,000 euros gross per month. Income above those thresholds will still receive an adjustment, but not the full index-linked increase applied below the cap.
The centenindex measure is scheduled to apply twice during the current government term, first from June 2026 and again in 2028. It affects higher salaries and higher pensions or benefits, while people below the thresholds continue to receive full indexation under the approved formula. The law also includes fiscal measures covering energy duties, the flight tax and the tax on investment accounts, placing the wage-indexation change within a broader budget package.
Inflation data frame reform debate
The approval came as official inflation data showed Belgian consumer prices rising faster in May. Statbel reported that inflation increased to 4.08 percent in May from 4.01 percent in April, while health-index inflation rose to 3.48 percent from 3.38 percent. Core inflation, which excludes energy products and unprocessed food, stood at 3.59 percent. Energy inflation rose to 11.20 percent, while services inflation increased to 5.88 percent during the month.
Belgium’s health index and smoothed health index are central to the country’s automatic adjustment system because they are used for rents, public wages, pensions, social security benefits and some salaries. The smoothed health index reached 100.19 points in May, with the next central index for public wages and social benefits set at 100.28 points. Transport had the largest upward effect on May inflation, while food and non-alcoholic beverages had the largest downward effect.
Pension changes advance alongside budget law
Parliament also approved pension measures tied to the same reform package. Workers who retire early without a sufficient career record will receive a lower pension, while people who continue working beyond retirement age may qualify for a bonus. Those pension changes are due to take effect in 2027. The package also includes temporary federal energy support measures for the next three months, including incentives for employers to increase commuting reimbursements for staff travelling to work by car.
The measures drew responses from employers and labour groups after the vote. VBO and Unizo supported the pension changes, while criticising the centenindex. Trade unions opposed the pension reform and said they planned to challenge the law before Belgium’s Constitutional Court. The centenindex could take effect from 1 June if the law is signed by the King and published in the Belgian Official Journal, completing the formal steps needed for implementation.