M and can in the SPD concept for inheritance tax reform criticize some things. Anyone who inherits 900,000 euros in their lifetime and a house in which they live will not have to pay a cent in taxes. Currently, there is a tax allowance of 400,000 euros plus property for children. For many, this is effectively doubled. This sounds like a wellness program for the upper middle class.
The 5 million limit for companies goes in the same direction. The SPD wants to completely exempt many rich medium-sized companies from inheritance tax. If this concept is implemented, many wealthy people in Germany will be able to save themselves strenuous meetings with tax advisors in the future.
In addition, the comrades are leaning their feet at a crucial point. It is unclear how high the tax rate should be for large inheritances. This will only be clarified in negotiations with the stubborn Union. However, it depends on the level of the tax rate whether more money will actually flow into the coffers of the federal states.
This concept is pure realpolitik and follows the logic of what is possible. And that’s true for two reasons: Inheritance tax is unpopular. Many see it as an inappropriate intrusion by the state into their private lives – especially at the moment of the death of a relative. That’s why it makes sense to package the whole thing nicely, to sell the reform as a simplification and to operate with easy-to-remember slogans like “Tax-free up to a million”.
The well-being program for high earners is needed
Second: It is necessary to link the inheritance tax reform with a well-being program for higher earners. Because the SPD is taking issue with this concept Association of Family Businessesthe most powerful corporate lobby in this country. She absolutely wants billionaire heirs to continue to not have to pay a euro in taxes. The usual suspects are already predicting the downfall of the German economy if the SPD prevails. The fact that the SPD is proposing a deferral of inheritance tax for up to 20 years is ignored.
The basic rule of pragmatism is: The sparrow in the hand is better than the pigeon on the roof. She has a lot going for her in this case. The Federal Republic’s political system is difficult and calibrated towards compromise, especially when it comes to a state tax. It doesn’t do much good to raise meaningful demands, as the SPD once tried with “inheritance for all”, and then drop them at the first resistance, like a toy you no longer want.
The ineffective inheritance tax is a central reason why wealth inequality is growing so rapidly in Germany. It’s time to do something about it. Not in seminars, but in government. That’s why the SPD concept is not half-hearted, but smart. It also addresses Union voterswho are skeptical about tax-free inheritance. However, if the SPD wants to be successful, it needs stability and staying power. Finance Minister Lars Klingbeil already knows this?