Recently, an article was published in Reuters on Belgium's indexation policy. In short, Belgium has an automatic indexation, meaning once a certain treshold of inflation is hit, the wages are automatically raised. The skyhigh inflation this year means that said indexation is also skyhigh, translating to a whopping 11.6% raise.
On top of that, the tax rates will also be indexed. What this means for the average Joe can be gleaned in this article from the website of VRT (public-service broadcaster). In it, they ran a simulation on how wages will evolve from 2022 to 2023, as seen in the picture below. There's three different living situations, and three or four starting wages.
In short, if you earn the net monthly income in column 2, you'll start 2023 with the net monthly income in column 4.
White and blue collar labor is taxed differently in Belgium, hence the distinction.
These systems guarantee that the purchasing power of the average citizen stays roughly the same over time.
There is some resistance from companies, though: For small companies (bars, restaurants or startups for example), having to pay an extra 11% in wages is a really hard hit. Some people also fear that this could cause an inflation loop: Companies have to spend more, charge this through to their customers, inflation rises and a new indexation means higher wages (and thus costs) for the companies, who again charge it to their customers.
The average employee, however, loves their government mandated pay raise. In the past, an “indexsprong” or skipping this automatic indexation, has been met with great uproar and resistance from unions.
The system seems pretty relevant to the sub, so I thought it might be interesting to show how we do things in Belgium. I'm not saying it's perfect, but I think a lot of Belgians are happy to have it in place.
For further reading, I suggest the Wikipedia page on Indexation.