Almost everyone will have less to spend

15th January 2008, Comments 0 comments

Almost everyone will see a drop in their purchasing power this year.

15 January 2008

UTRECHT – Almost everyone will see a drop in their purchasing power this year, except for people 65 and over with a low income and working single parents. On average people will have EUR 13 less to spend each month, according to the National Institute for Budget Information (NIBUD). The main reason for the drop in purchasing power is inflation.

Purchasing power will fall by a quarter to 1 percentage point, says NIBUD. Since many daily costs like food and petrol are more expensive this year than last, many people will feel the drop in purchasing power in their wallets.

Most gross salaries will increase by 3.25 percent on average in 2008. But that is not enough to cover all price increases, says NIBUD. Moreover, not everyone will get a pay rise as soon as January. People who get the same salary as in 2007 must take into account that they will see even more of a drop in purchasing power. Take home pay will not decrease, but it will not stretch as far because of higher prices than last year.

The prices of food and oil in particular have risen significantly and will most likely continue to rise in the course of the year. Motorists will be facing higher petrol prices and lease-car drivers will face higher tax as well.

Those aged 65 and over with a low income (a supplementary pension of maximum EUR 10,000 per year) will profit from a higher pensioners' rebate and single working parents from the new child benefit. These groups will consequently see purchasing power rise.

[Copyright Expatica News + ANP 2008]

Subject: Dutch news

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