The relief on income tax that CDU General Secretary Carsten Linnemann has proposed would create a state revenue deficit in the billions of euros. “The proposal translates into a yearly saving of nine billion euros” DIW tax expert Stefan Bach told “Welt” on Tuesday.
Bach’s DIW calculations show that the new top‑rate threshold-raising it to 80,000 euros of taxable income as Linnemann suggested over the weekend-could spare up to €1,000 a year for single filers and up to €2,000 a year for couples. Those benefits apply only to households in the top ten percent of income earners. A single person with an average income would see a €92 relief, while a family with two children and an average income would see a €160 reduction.
Bach points out that to make the reform revenue neutral, the top marginal tax rate would have to be increased to 47 percent, which would be reached at a taxable income of €97,200.
