German Cabinet Approves €10 Billion Income-Tax Reform
The package would raise child benefits and the basic allowance while adding a new 47% rate for income above €280,000.
- On Wednesday, Germany's Federal Cabinet approved a €10 billion income-tax reform package designed to ease burdens on low- and middle-income households, particularly families with children.
- The government will partly offset costs by raising taxes on high earners, including a new 47% "super-rich tax" on annual income above €280,000, as Klingbeil said the system must become "fairer."
- Under the plan, child benefits will rise to €267 per month next year, the basic tax-free allowance increases to €12,564 in 2027, and employee business expense deductions rise from €1,230 to €1,430.
- The bill requires approval from the Bundestag and Bundesrat, where the coalition must secure support from German states that receive 42.5 percent of tax revenues, with further debate possible.
- Critics argue the relief may not offset inflation; the German Chamber of Industry and Commerce called the increase a "tax on small and medium-sized businesses," while Green parliamentarian Andreas Audretsch warned of offsetting benefit cuts.
51 Articles
51 Articles
The Federal Government has passed the draft for the income tax reform. Above all, the recipients of small and medium income as well as families are to profit. According to the Federal Ministry of Finance, the discharge volume amounts to ten billion euros every year.
Westfalenpost
Supplements, rich tax, children: government wants to relieve millions of households with smaller incomes. The economy is criticizing.
Supplements, rich tax, children: government wants to relieve millions of households with smaller incomes. The economy is criticizing.
The German Government's Council of Ministers approved on Wednesday the bill on the "early retirement pension", under which all children in Germany will receive from the age of six an initial capital of €10 per month from the State for private retirement until they reach the age of 18. This measure, which was already introduced last December in the framework of a broader bill to strengthen the private pillar of the German pension system, can be s…
What does Germany's '€10 billion' income tax reform mean for you?
A higher basic allowance and more benefits for parents: Germany is pushing forward with its major income tax reforms, aimed at relieving low and middle income households. So how much can you really expect to save?
Readers discuss tax reform 2027: Are children's allowances and allowances sufficient to compensate for rising burdens?
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