The German Social Democrats (SPD) are pressing their coalition partners, the Christian Democratic Union (CDU) and Christian Social Union (CSU), to overhaul the controversial “Ehegattensplitting” system – a marital income splitting arrangement in the German tax code. SPD General Secretary Tim Klüssendorf has publicly urged a “courageous” and collaborative effort within the ruling coalition to modernize the system and reflect contemporary family dynamics.
The current Ehegattensplitting, where married couples’ incomes are combined and taxed as if each partner earned half, has long been a point of contention. Critics argue it fosters an outdated, rigid societal model and disproportionately disadvantages women, often rendering additional work financially unrewarding due to the system’s impact on their individual tax brackets. The SPD has consistently advocated for a departure from this arrangement, proposing a “family splitting” model instead. This alternative would allow both partners in a new marriage to work full-time without incurring a tax disadvantage.
Family Minister Karin Prien of the CDU has acknowledged the need for reform, signaling a potential shift in perspective within the traditional conservative camp. While publicly stating the desire for a move towards a family splitting system, Prien has also expressed frustration with the slow pace of change, suggesting a resistance to embracing more progressive policies.
The CDU/CSU’s commitment to Ehegattensplitting is formally enshrined in their electoral manifesto, although there is growing recognition of the need to address its inequities. The party has committed to strengthening the tax consideration of children, increasing child allowances and aligning them with parental income levels. However, this stated intention has not translated into concrete action or been incorporated into the existing coalition agreement, highlighting a potential ideological conflict within the governing alliance.
The SPD’s push for reform represents more than just a disagreement over tax policy; it’s a reflection of broader societal debates concerning gender equality, traditional family structures and the evolving expectations of modern German families. The coming months are likely to see heightened political maneuvering as the coalition attempts to reconcile these competing pressures and determine the future of this long-standing and politically sensitive tax provision. The lack of explicit mention of reform in the coalition agreement already indicates that intense negotiation will be required to bring about meaningful change.