Cosmetics Industry Claims New Tax Rules Breed Suspicion
Economy / Finance

Cosmetics Industry Claims New Tax Rules Breed Suspicion

Industry representatives are voicing strong concerns regarding a proposed bill from Finance Minister Lars Klingbeil, aimed at combating illicit labor practices within the hairdressing and cosmetics sectors. The German Association of Nail Designers (VNDD) has characterized the initiative as imposing an “unbearable presumption of guilt” onto employees.

Terri Malon, Managing Director of the VNDD, stated to the Redaktionsnetzwerk Deutschland that the complexity of existing bureaucratic processes already places a significant burden on small businesses, such as nail studios. She expressed dismay at the government’s decision to escalate this situation and effectively place an entire industry under suspicion.

Malon acknowledged an increase in businesses operated by individuals of Vietnamese origin since the end of the COVID-19 pandemic. She noted that these establishments are often located in city centers and shopping districts and she personally finds it difficult to believe that illegal labor is being employed.

The proposed legislation mandates identification requirements for employees in hairdressing salons, barbershops and nail studios, intended to definitively establish their identity during inspections. The move, set to be approved by the cabinet this Wednesday, is justified by the government’s assertion that without mandatory identification, verifying the identities of individuals encountered during inspections can be extremely time-consuming.