The Social Democratic Party (SPD) is pushing for the abolishment of income splitting for married couples, a system currently benefiting primarily households where one partner earns significantly more than the other. Wiebke Esdar, Vice-Chair of the SPD parliamentary group, highlighted in an interview with the Handelsblatt that this system creates disincentives for women’s employment, often leading to part-time work, reduced unemployment benefits and lower pension entitlements.
Esdar stated that the state should not perpetuate outdated gender roles and inequalities, emphasizing the potential for dependency this system can create, particularly for women. Recognising the need for reform, she expressed the SPD’s readiness to negotiate with the Christian Union on transitioning to a more equitable family splitting model.
Sarah Philipp, Chair of the North Rhine-Westphalia SPD, echoed the call for reform, stating that her party is open to discussions with the Union. She also addressed the ongoing debate concerning the reform of the social state, arguing against solely relying on spending cuts and advocating for a focus on increasing revenue.
The SPD’s position is supported by expert opinion. Monika Schnitzer, Chair of the Council of Economic Experts, recently recommended abolishing income splitting in a report for the German-French Council of Ministers. A previous study by the RWI economic institute suggested that such a measure could lead to an increase of over half a million full-time jobs. The current system provides tax advantages for married couples, primarily benefiting those with a significant income disparity.
