The German crafts sector is fiercely opposing the Social Democratic Party’s (SPD) proposed inheritance tax reforms, raising concerns over potential damage to family-run businesses and regional economies. Jörg Dittrich, president of the Central Association of German Crafts (ZDH), has condemned the plans as a misguided intervention, urging caution and a deferral of any changes until the Federal Constitutional Court delivers its pending ruling on inheritance tax matters.
The SPD’s proposal, unveiled this week, aims to redistribute the inheritance tax burden, increasing taxes on substantial inherited wealth while providing relief to smaller inheritances. The party argues this reform is a crucial step towards greater social equity. However, business leaders are questioning this assessment, particularly within the vital sector of skilled trades.
Dittrich sharply criticized the SPD’s understanding of fairness, pointing out a critical distinction between luxury assets like yachts and inherited properties versus operating businesses that shoulder responsibilities for employees and apprentices. He emphatically defended the existing exemption for business assets, arguing its preservation is paramount. Family-owned craft businesses, he explained, fundamentally reinvest their wealth in workshops, machinery and vehicles, rather than building readily available capital.
“Any limitations to these protective measures would jeopardize future generations, place undue strain on businesses and ultimately weaken the regional economic backbone” Dittrich warned. Concerns are escalating that alterations to the existing regulations could disincentivize succession, forcing closures and dampening investment within the sector, areas already grappling with skilled labor shortages and rising costs. The ZDH’s resistance highlights a deeper political debate over the role of family businesses in the German economy and the potential unintended consequences of seemingly equitable tax reforms. The debate will undoubtedly continue as the government weighs the SPD’s proposals against the concerns of a crucial economic sector.
