Monika Schnitzer, head of the government’s economic experts council, called the Union’s proposal to give middle‑income taxpayers relief “expensive and hardly sensible”. In an interview with the “Rheinische Post” (Thursday edition), she warned that simply easing the income tax will quickly become very costly. According to Schnitzer, raising the bracket for the highest tax rate alone could cost the state double‑digit billions of euros per year, and the relief would amount to a mere €13 per month for an average earning family.
She pointed out that, on the other hand, contributions to health and nursing care insurance have risen sharply. The proposed tax cuts “correspond quite precisely to the extra burden the same family faces at the beginning of the year from increased supplementary health contributions”. With those contributions expected to climb further, Schnitzer argued it would be far more sensible to offset this burden through reforms of the social‑insurance system, for example by implementing the hospital reform more consistently and making the system more efficient.
The coalition had promised tax relief in its governing agreement, and the public is receptive, especially given the rising load from social‑insurance contributions. However, she warned that such discussions must happen against the backdrop of significant budget deficits in the coming years-deficits that arise partly because the federal government has spent heavily on single‑interest measures, such as raising the maternity pension and cutting the gastronomy value‑added tax.