BFederal Minister of Finance Christian Lindner has admitted that cuts in income and corporate taxes are currently not politically realistic. “As long as there is no new thinking among the coalition partners, I will concentrate on what is achievable. These include tax incentives for investments and research,” said the FDP politician in an interview with “Bild am Sonntag”.
The tax proposals are part of the “growth package 2023/2024” that experts from Lindner’s ministry have developed for a trend reversal in economic policy. The paper warns that “the importance of tax policy for competitiveness has long been misunderstood.”
The “fire wall” against tax increases must be maintained. Lindner made it clear that he was determined to do this: “50 percent of the taxpayers pay 90 percent of the wage and income tax revenue. A further burden would not be fair,” said the finance minister in the interview.
Lindner sticks to his position, as does the SPD
Leading social democrats see it differently. SPD Chairwoman Saskia Esken once again called for very high incomes and assets to “contribute more” to financing tasks such as educational equity and digitization. Bundestag President Bärbel Bas criticized, like Esken, that the help and relief in the energy crisis were socially unbalanced: “The frequently praised villa owner gets a multiple of what families get in a draughty rented apartment,” Bas told the “Neue Osnabrücker Zeitung”.
She predicted that “very low-income” households would need additional government support in 2023. A mechanism for staggered direct payments is then “absolutely” needed. Bas sent a warning to Lindner: “I hope that his house is working on it at full speed.”
A differentiated picture of the relief measures for the current year results from new calculations by the employer-related Institute of German Business. Accordingly, high-income households benefit more in absolute terms because they pay more taxes and consume more energy. In relative terms, however, households with lower incomes benefit the most: a single person with an annual gross income of 30,000 euros saves 2.3 percent, while a single person with 72,000 euros saves 1.8 percent. A family with an annual gross income of 60,000 euros benefits the most from the measures – by 4 percent.
