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 of about EUR
61,000 to 76,000, according to the FAZ) will receive increasingly less tax relief,
only. This means that in the respective bracket the marginal tax rate (at present
44.3% including the soli) will jump up to up to 50.5%. These shortcomings are
all the more problematic as for many partnerships the income tax is a major
element of company taxation.
EU Forecast
euf:ba18.d:145/nws-01