New Rules On Indexation? The "Index In Money" Explained

• Published date: 05 December 2025
• Law Firm: Loyens & Loeff
• Author: Mr Kris De Schutter, Lucia Bellobuono, Charlotte Pauwels-Devillé, Joris Beernaert and Victoria van Damme

The "index in money": What is it?

The index in money would mean that in 2026 and 2028 the full indexation of wages will be capped once a gross salary of 4.000 EUR is reached. Wages above 4.000 EUR gross will no longer be fully indexed, but only for a maximum equal to the difference between the actual index figure (above 2%) and that 2% (index threshold amount).

Employers must still apply salary indexation for salaries above 4.000 EUR gross, but only for half of the normal additional amount. This half does not go to employees; instead, it is transferred to the government. The remaining half does not need to be paid out by employers and serves as a cost-saving measure on salary expenses for employers.

We illustrate this with an example where the indexation is 3%, based on a salary of 5.000 EUR (gross amounts):

Index in Money (normally 3%)	Regular Index (3%)
3% of 4.000 EUR = 120 EUR	3% of 5.000 EUR = 150 EUR
Regular index (3%) - 2% (threshold) = 1% on the remaining 1.000 EUR
1% of 1.000 EUR = 10 EUR
Total employee: 5.130 EUR	Total employee: 5150 EUR
Difference between regular index and index in money = 150 EUR - 130 EUR = 20 EUR
Difference (and loss) of 20 EUR for employees compared to regular index: 10 EUR goes to the government; 10 EUR is a saving on employer salary costs (12,8 EUR including social security contributions).
Actual index percentage: 2,6%	Actual index percentage: 3%

In an earlier version of the proposal, it was stated that for gross salaries above 4.000 EUR, no indexation would take place at all. Because this could lead to unequal treatment between f.e. part-time and full-time employees, the government would now abandon this scenario and opt for applying a capped indexation percentage instead.

Capping indexation: not uncommon at sector level

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