Old-age provision: SPD for additional taxes to stabilize the pension

The SPD is considering taxes for large assets in order to stabilize the pension level. The party also hopes for positive effects from immigration.

Old-age provision: SPD for additional taxes to stabilize the pension

The budget expert of SPD, Johannes Kahrs, has decided to stabilize statutory pension by year 2040 for additional taxes. "The subsidy from federal budget for pension will increase in long term," said budget spokesman of SPD Bundestag group to newspapers of Funke Media Group. "We need to talk about additional revenue streams, such as financial transaction tax or an additional tax on large assets," he said. However, postponement of solo degradation or higher value added tax is not an issue.

In its electoral programme, SPD had pronounced itself to keep pension level up to 2030 at least at current level of 48 percent. "The stabilization of pension level requires considerable resources and will be financed in addition to moderately higher contributions through a higher tax subsidy to pension insurance and a new Demografiezuschuss," programme states. The pension level describes ratio of current average pension to current average wage.

Federal Minister Katarina Barley (SPD) told Rheinische Post that predictions about such a long period are always difficult. Immigration to Germany, for example, "enormous opportunities for our ageing society". A well-made immigration law is needed in order to bring targeted young professionals to Germany. "This also relaxes relationship between contributors and pensioners."

On Friday, Federal Ministry had rejected a report on reflections on possible tax increases to stabilise pension level. The mirror, citing circles of Ministry of Finance, reported that Finance Minister Olaf Scholz (SPD) was prepared to increase contributions to pensions and taxes "vigorously" for stabilising retirement level by 2040. He is opposed to a higher retirement age.

Updated Date: 26 August 2018, 12:00

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