Tax reform: SPD wants to make wealth and inheritance tax a “key issue”.

SPD General Secretary Tim Klüssendorf has announced a tough battle with the Union over the return of wealth tax and a higher inheritance tax. »Especially in Germany we have an increasing concentration of wealth. This applies to real estate as well as to company ownership. This means that the profits end up with fewer and fewer people,” said Klüssendorf in an interview with the New Osnabrücker Zeitung. The reason for this is also the misguided tax policy of the past decades. “That’s why we absolutely need changes to inheritance and gift tax as well as the activation of wealth tax,” said Klüssendorf. “The SPD will make this their key theme this year.”

Anyone who receives assets through the death of a relative is subject to inheritance tax. How high the taxes are depends on the degree of relationship and the value of the inheritance. Spouses can inherit tax-free up to 500,000 euros, children up to 400,000 euros. Taxes must be paid on everything beyond that; the tax rates vary between seven and 50 percent. Large sums can currently be passed on without paying taxes and during your lifetime. This is made possible through so-called donations.

A large proportion of assets in Germany are passed on untaxed. The German Institute for Economic Research (DIW) estimated the annual value to be up to 400 billion euros in 2021. According to DIW, the richest percent of the population owns more than a third of the total wealth in Germany. The richest tenth actually account for around two thirds of the total wealth.

The Federal Constitutional Court’s ruling could point the way

According to Klüssendorf, a groundbreaking ruling on inheritance tax from Karlsruhe is expected at the end of the year. “At the very latest with the verdict, the Union will also have to admit that we have to intervene,” said the SPD General Secretary. He also emphasized the importance of reinstating the Property tax. His reasoning: “We have long since reached the limits of taxes on income, corporations and consumer goods when it comes to creating more fair distribution. At the same time, billionaires think they are having a bad year if they make less than ten percent profit in a year, even if that still amounts to around 100 million euros. Nobody can seriously close their eyes to the concentration of wealth in runaway capitalism.«

At the time, the wealth tax was intended to dampen such developments, explained Klüssendorf. When it comes to the possible level of wealth tax, Klüssendorf advised taking the tax on the rich as a guide. This would involve one percent annually for assets above 100 million euros. »That alone would bring in tens of billions. This would immediately help states and municipalities, which are entitled to the money according to our constitution, to fulfill their tasks, from modern schools to proper daycare centers to well-established police,” he said.