According to a study, the relief package put together by the traffic light coalition because of the high energy prices will not compensate for the losses suffered by citizens this year. The annual total volume of an estimated 12 billion euros is put into perspective in view of the current price increase, according to a short report by the Cologne Institute for Economic Research (IW), which is available to the German Press Agency. “The relief will only be able to partially compensate for the loss of purchasing power among the citizens.”
In view of the exploding prices for gas, electricity, oil and fuel, the leaders of the SPD, Greens and FDP decided on several relief measures last week. In the tax return, the basic allowance, flat-rate income tax allowance and, limited to 2026, the commuter flat-rate for long-distance commuters are to be increased retroactively to the beginning of the year. The EEG surcharge for green electricity will be removed from the electricity bill in July and financed through the federal budget. There should also be an immediate bonus for children affected by poverty.
According to the IW report, the measures are “easily financed” by the Treasury because tax revenues are also increasing in the shadow of inflation. For every percentage point of inflation, tax revenues are estimated to have increased by more than ten billion euros.
According to IW Köln, a single person with an annual gross income of 25,000 euros will have to pay around 150 euros less this year as a result of the tax measures and the abolition of the EEG surcharge. The more you earn, the higher the relief. A single person with an annual income of 75,000 euros will pay around 185 euros less. Whether you use the higher flat rate for long-distance commuters or the higher flat rate for advertising costs makes little difference. Without the higher commuter allowance from the 21st kilometer, there would generally be no relief for commuters with long distances.
In addition, the scientists of the IW see risks in the relief package: The higher basic allowance leads to a further compression of the income tax rate, i.e. to a rapid increase in the tax rate at the beginning of the rate, they write. This reduces the incentive to expand a job or to work at all as a second earner in a marriage. The increase in advertising costs was also overdue anyway – the last time the flat rate was raised was in 2011.
The coalition’s relief package still has to be approved by the cabinet, Bundestag and Bundesrat before it can come into force. It is to be financed from the 2022 budget, which Finance Minister Christian Lindner (FDP) intends to present in the middle of the month.