Economist Praises “Boomer Tax” Idea

Economist Praises "Boomer Tax" Idea

The chair of the Expert Council for Economic Affairs (SVR), Monika Schnitzer, has expressed support for a proposed special levy targeting wealthier pensioners.

Speaking to newspapers belonging to the Funke-Mediengruppe, Schnitzer emphasized the rationale behind the suggestion. She stated that the burden of pension obligations for the Baby Boomer generation cannot solely rest on the shoulders of the increasingly smaller number of younger contributors. She added that members of the Baby Boomer generation themselves need to contribute to the solution.

The proposal, involving a redistribution of resources among retirees, was initially put forward by the SVR in its pension report two years ago. Schnitzer acknowledged that the proposal by the German Institute for Economic Research (DIW) for a “Baby Boomer solidarity contribution” is more comprehensive than the SVR’s original suggestion.

The considerations are driven by several demographic factors. Notably, life expectancy is increasing, adding further strain on the pension system. Furthermore, birth rates have been below replacement levels since the 1970s, impacting the overall population structure and significantly altering the ratio of contributors to beneficiaries.