The CDU and SPD want that Middle class relief from tax. That’s what they wrote into the coalition agreement. But the governing parties are arguing about exactly how this should work. The CDU wants to achieve that the top tax rate of 42 percent only applies from 80,000 euros. So far this has been the case from 69,879 euros. The SPD only wants to go along with this if the top tax rate increases at the same time, namely to 47 percent. The CDU rejects this.
But do the ideas of the two parties actually make sense? Or wouldn’t there be better ways to relieve the burden on low earners and the middle class? That’s what this new episode of Is that a bubble? the ZEIT economics podcast about money, power and justice. The two hosts Carla Neuhaus and Zacharias Zacharakis invited Nadja Dwenger. She is a professor of finance at the University of Hohenheim and says: We definitely have a justice problem, but it doesn’t so much concern taxes – but rather social security contributions. Because they place a disproportionate burden on low earners.
In her opinion, this is where we should start. “You have to be honest at this point,” says Dwenger, “and stop using social security funds to finance things that cannot be financed.” What does she mean specifically and how social security contributions could be reduced? where a lot more money will be needed for care, health and pensions in the next few yearsshe explains in this episode. She also classifies the plans of the SPD and the Union. And she explains who economists in Germany actually count as the middle class – and why Chancellor Friedrich Merz is definitely not one of them.
Roman Pletter, head of the economics department at ZEIT, also appears in this episode. He explains why politics is Income tax want to reform at all.
Is that a bubble? is the ZEIT business podcast. Every two weeks on Mondays, hosts Carla Neuhaus, Jens Tönnesmann and Zacharias Zacharakis discuss what holds the world together at its core: money, power and justice.