The Left Calls for Higher Social Contributions from Top Earners in Saxony
call for elevated social taxation on substantial wages within Left Party's agenda - Advocates push for enhanced social contributions from individuals with higher earnings
In a push to financially sustain the social system, the Left party has advocated for increased contributions from high-income earners in the German state of Saxony. According to party leader and parliamentary group leader Susanne Schaper, individuals earning six-figure incomes should bear a fair share of social contributions and higher taxes, with additional emphasis on a wealth tax.
Schaper underscored her stance, asserting that such measures would not impoverish anyone but contribute to overall wealth generation. This, in turn, would make the country fairer, allow for long-term investments in infrastructure, and ensure the preservation of the common wealth.
The discussion revolves around contribution assessment limits, which cap contributions for pension and unemployment insurance at annual incomes of €96,600, while health and long-term care insurance limits are set at €66,150. Any additional income above these thresholds currently goes untaxed.
As per data from the state parliament, there were 499 income millionaires in Saxony in 2022, up from 230 in 2014. The individual with the highest income in 2022 earned almost €24 million. In total, income millionaires accounted for around €1.2 billion.
The Left has criticized the tax administration's limited examination of million-dollar incomes, with only a fraction being checked annually. According to their analysis, the rate has never surpassed 30% since 2014, and in 2021 and 2022, just 4% and 1%, respectively, of affected individuals were audited. Schaper calls this unacceptable, especially given the immense incomes involved.
Compared to the nearly two million taxable individuals in Saxony, the number of income millionaires remains relatively low. Moreover, Saxony trails the wealthiest German states, such as Bavaria, North Rhine-Westphalia, and Baden-Württemberg, where it comes fourth in terms of top earners. However, it's worth noting that Germany as a whole ranks sixth globally with approximately 2.7 million millionaires.
In terms of the broader impact of this prolonged increase in millionaires on social contributions and tax revenue, while the effect may be less significant than in countries with more rapid wealth growth, the increase in millionaires still contributes positively to Germany's economic health and tax base. The stable economic climate fostered by the presence of these affluent individuals can support business growth and investment opportunities, indirectly benefiting the broader economy.
- The Left party's proposal for increased social contributions from high-income earners in Saxony, particularly six-figure earners, is focus on finance and politics, aiming to sustain the social system and generate wealth for business growth and investment.
- The discussion of contribution limits in Saxony's policies highlights the need for more comprehensive examination of million-dollar incomes in the finance and politics sectors, with the current audit rate of affected individuals being unacceptably low, given the enormous wealth involved.
