The opposition, in majority, approved this in Parliament last month, with the aim of the lowest-possible pre-tax pay for a full-time, 40-hour-a-week job sitting at €950 by the year 2019.
But now, the increase has been made official after the Lower Chamber formally signed it off Thursday.
At present, the minimum monthly salary for a full-time job is €655, albeit over 14 wage packets – a double one in August and at Christmas – meaning firms which pay 12 salaries a year must give their staff a minimum of €764.17 a month.
Self-employed workers earning less than the minimum wage are not required to pay their Social Security stamp, a fixed monthly fee of €267.03 irrespective of earnings.
For employees, they will not have to pay more than 3% of their gross salary in Social Security.
Companies bear the bulk of staff’s Social Security contributions, which covers healthcare, retirement pension and provision for State benefits, paying 44% on top of employees’ gross wages, but a small contribution is also made by the employee.
The minimum wage change was agreed during the same session as the Lower Chamber agreed its spending limit for 2017, which will be €118.34 billion, not taking into account the cost of repayment of loans and interest.
This is the first step for preparing the State budget, which looked set to be on hold after 11 months without a government, until October when president Mariano Rajoy was sworn in again.
Changes to company profit tax, which has gone up in a bid to shrink the State deficit and avoid being fined by Brussels, and an increase on the tax element of alcohol – except wine and beer – cigarettes and sugary soft drinks were also approved yesterday.
Combined, these tax increases will bring in an extra €4.8bn over 2017.
Spain needs to up its income by €7bn to meet next year’s deficit target of 3.1% of the GDP – although the Bank of Spain says it is unlikely to get below 3.6% and will probably also miss its targets for 2018 and 2019.
Most Parliamentary groups criticised the company profit tax hike and the fact that the State spending limit will be no higher than that of 2016, which the opposition parties said was already insufficient having suffered huge cutbacks in the four previous years.