A new pension scheme, dubbed “Aktivrente” and slated to launch in 2026, is facing potential legal challenges based on concerns regarding Germany’s constitutional principles. The German Institute for Economic Research (DIW) has suggested the tax advantages afforded to retirees under the scheme could violate the fundamental equality principle enshrined in the Basic Law (Grundgesetz).
According to Stefan Bach, DIW’s tax expert, the “Aktivrente” introduces a differentiated treatment that necessitates careful scrutiny. He anticipates potential legal action regarding the scheme and believes the Federal Constitutional Court may ultimately be called to rule on its legality. Bach acknowledged that the preferential tax treatment of retirees could be justifiable if demonstrably linked to bolstering economic growth within the country.
Echoing this viewpoint, constitutional law expert Hanno Kube from Heidelberg University also considers the “Aktivrente” problematic from a constitutional perspective. He emphasizes that the significant unequal treatment presented by the scheme requires a compelling justification. While a rationale rooted in economic policy – such as encouraging continued employment by older individuals – could be conceivable, substantial doubts remain.
Concerns primarily surround the risk of considerable unintended consequences arising from the new regulations. Furthermore, the scheme’s interaction with the existing tax-free allowance raises further questions requiring clarification. The potential for legal challenges and debate surrounding the scheme’s constitutional grounding is expected to continue in the coming months.