Ministry: Over 100,000 pensioners affected by tax reduction on pensions
Currently, approximately 6.3 million out of around 21 million pensioners are taxable. The pension was increased by 4.57 percent as of July 1. This adjustment applies uniformly throughout the entire federal territory, with no differences between East and East and West Germany anymore.
In West Germany, including Berlin, 91,000 pensioners and pensioners' wives fell back into taxation after the increase - previously, 197,000 had been exempt due to the increased tax-free allowance. In East Germany, 23,000 additional people in retirement now have to pay income tax, while 47,000 had been exempt before.
BSW Chairwoman Wagenknecht called it "embarrassing" that over 100,000 pensioners and pensioners' wives fell back into taxation after the pension increase. "The pension tax is one of the most unfair taxes in Germany," she told AFP. "Decades of saving and paying in, then receiving a pension that is below average in Europe, and then the tax office comes knocking."
Therefore, the BSW is demanding a "pension tax brake": The statutory pension should reportedly remain tax-free up to €2,000. "This would relieve millions of pensioners with small and medium pensions," said Wagenknecht.
- The Federal Finance Ministry is currently reviewing the impact of the pension increase on taxable pensioners, as stated by the AFP.
- Sahra Wagenknecht, the chairwoman of BSW, has criticized the pension tax, claiming it to be one of the most unfair taxes in West Germany, specifically in Berlin.
- According to Wagenknecht, the pension tax is particularly distressing for pensioners and their wives who have recently been pushed back into taxation due to the recent rent increase and the consequent pension adjustment in West Germany.
- The Ministry is considering implementing a "pension tax brake," which would exempt statutory pensions up to €2,000 from income tax, as proposed by the BSW, aiming to offer relief to millions of pensioners with smaller pensions.
- The demand for the pension tax brake stems from the fact that many pensioners in both East and West Germany, including Berlin, are now facing higher tax burdens due to the pension adjustments, leading to a combined total of over 100,000 pensioners and their wives falling back into taxation.
- AFP reported that Wagenknecht described the situation as embarrassing, highlighting the disparity between the tax benefits for high-income individuals and the tax burden on pensioners with below-average pensions in Europe.
