Warnings from business associations Against warnings from business associations the parties agreed on additional restrictions on fixed-term contracts. While the CDU/CSU has rejected the SPD’s demand to abolish the rule that (new) employment contracts can be limited to up to two years without a material reason, the three parties agreedRead More →
Globalisation and digitalisation have increased the disparity Although globalisation and digitalisation have increased the disparity in market incomes in Germany, as they have in other nations, the country continues to enjoy a low level of net household income inequality compared to other OECD countries thanks to its effective system ofRead More →
More instead of less regulation Labour market policy: more instead of less regulation While the buzzword digitalisation seems to be omnipresent in the draft treaty sensible labour market policy measures to cope with the challenges from this technological revolution are rare. Instead the new Groko continues to tighten labour marketRead More →
Groko’s tax policy’s inadequacy Corporate taxation, in general, is proof of the Groko’s tax policy’s inadequacy. While President Trump’s reform started a new round in the international competition for corporate investment, the draft coalition treaty does not provide for systematic tax relief to strengthen Germany as location for private (realRead More →
Correction of the disincentives Above all a sensible correction of the disincentives resulting from the strongly increasing marginal income tax rates in the lower- and middle-income brackets is missing. Instead the Groko’s half-hearted Soli abolishment adds to the problem in our view. Taxpayers with higher income (in the bracket ofRead More →
Outlook and risks As noted above, Germany’s outstanding economic development is due to the interaction between individual, macroeconomic and institutional factors. Firstly, these factors have enabled the country to successfully exploit the opportunities created by globalisation and digitalisation better than most other industrialised countries. At the same time, they haveRead More →
25% flat-rate withholding tax on interest income In contrast to the CDU/CSU’s election campaign promise not to raise taxes, the 25% flat-rate withholding tax on interest income shall be abolished so that the respective earnings will be subject to the (individual) income tax. However, the flat-rate withholding tax on dividendsRead More →
Tax policy lacks ambition Tax policy: corporate Germany left out in the cold Especially, the tax policy lacks ambition in our view. Despite surging tax revenues (2013 to 2017: +18.5% in total; 2017 to 2021: 17% or EUR 93.6 bn in total to EUR 858 bn under present law, accordingRead More →
EUR 18 bn for digitalisation EUR 18 bn for digitalisation and education The new Groko aims at “stability and social cohesion as well as innovation and security” in Germany via intensified public spending on education, infrastructure and on social security. Government funds of about EUR 22 bn are earmarked forRead More →
Patience the key to success Low private and public-sector debt, a considerable willingness to train and long- term corporate strategies are the result of specific behavioural patterns. In behavioural science these patterns are referred to as self-regulation and the ability to forgo instant gratification. In economics they are discussed usingRead More →
Designed using Magazine Hoot. Powered by WordPress.