Germany is a tax haven for wealthy people. Julia Jirmann from the Tax Justice Network is convinced of this. “We are a low-tax country,” said the speaker when presenting the study “Tax the super-rich fairly (again).” According to a study, billionaires even pay less taxes in Germany than in Switzerland. Although the taxation of employment income works well in Germany, there are various special regulations and tax privileges for multimillionaires or billionaires who primarily have corporate and property income.
The study that Network Tax Justice published together with the organization Oxfam and the Austrian Momentum Institute, has examined the tax systems in Germany, Austria and Switzerland. It shows that German billionaires remain well below the maximum tax rates. In Germany, the tax rates for billionaires are on average 26 percent with a possible maximum tax rate of 47.5 percent. For comparison: the tax and levy contribution of middle-class families goes far beyond this at 43 percent.
In Switzerland, which has a wealth tax, billionaires pay an average of 32 percent in taxes, with a maximum rate of up to 41.5 percent. The Swiss tax system is more progressive than that in Germany and Austria, said Oxfam’s social inequality officer, Manuel Schmitt. He called for high wealth to be taxed in Germany and Austria too, “so that the super-rich can also make their fair contribution to the common good.” Instead, Finance Minister Christian Lindner (FDP) is aiming to “clear-cut” development cooperation and social spending.
The authors of the study calculated that a wealth tax based on the Swiss model would bring Germany additional revenue of 73 billion euros. They suggest that the federal government could use the money to plug the budget hole estimated at 20 billion euros and thus avoid cuts in the development budget. Urgently needed investments for climate protection and greater social justice could also be financed in this way.
For their analysis, the study authors determined the respective tax and contribution rates of typical representatives of the richest 0.1 percent using a model calculation. In addition, the experts from Germany, Austria and Switzerland calculated the tax rate of specific billionaires such as the BMW heirs Susanne Klatten and Stefan Quandt based on publicly available data on company investments and from annual reports.