Germany insists on raising social contributions from higher-income earners - Demand from the Left for Increased Social Contributions Among High Earners
Third-Party Contributions: The Left Pursues Increased Financial Contributions from High Incomes
The political party The Left is advocating for a larger share of contributions from high-income earners in financing social systems, as stated by party leader Susanne Schaper.
Schaper argues that those with six- or seven-figure incomes should pay higher social contributions and taxes proportionate to their earnings. An inheritance tax is also a necessary requirement, she asserted.
"This doesn't make anyone poor, but makes us all richer," emphasized Schaper. She explained that this step would help address inequities, invest in infrastructure, and uphold public welfare long-term.
Contributions for pension, unemployment, health, and long-term care insurance are due only for annual incomes up to 96,600 euros and 66,150 euros, respectively, beyond which they become contribution-free.
In 2022, Saxony alone had 499 income millionaires, as disclosed by The Left party following a parliamentary request for information. Complete data from the finance ministry is only available up to 2022.
According to The Left, the tax administration only checks a minority of million-dollar incomes. "The rate has never exceeded 30 percent since 2014, with only four checks conducted in 2021 and just one percent in 2022," they noted. This is unacceptable, especially given such substantial incomes, said Schaper.
Comparatively, there are fewer top earners in Saxony than in other federal states, with Bavaria (6,801) and North Rhine-Westphalia (6,550) leading the pack, followed by Baden-Württemberg (4,629).
Enrichment Data:
- Economic Performance: Saxony, part of the eastern German states, has shown strong export performance, significant industry presence, and notable research expenditure, placing it among top EU regions in certain economic indicators.
- Wage Levels: Though specific income distribution data for Saxony is not detailed, real income and quality of life are examined as part of economic analysis in eastern Germany. Traditionally, wage levels have been lower in eastern states, but productivity and industry concentration can lead to higher incomes in specific sectors.
- High-Income Earners: The east German regions, including Saxony, are generally characterized by lower average incomes compared to western states. However, certain cities and industries may have a growing concentration of high-income professionals.
The Left party suggests that high-income earners should contribute more to financing social systems, not just in Saxony but nationwide, as part of their policy to address disparities and bolster public welfare. In light of this, it is concerning that only a minority of million-dollar incomes are checked by the tax administration, according to The Left, calls for stricter compliance in business and finance spheres, particularly considering the significant impact of such incomes on the economy and the general-news landscape.
