The Taxpayers’ Association expects that, despite recent tax reforms, many citizens will find themselves with less net income in 2027. According to Reiner Holznagel, the association’s president, the year 2027 is poised to become one of disappointment for many employees. He noted that social security costs are continuing to rise while the current income tax situation, dictated by the governing parties, offers little relief. Taken together, this means that many people face a reduction in take-home pay in the coming year.
The burden is set to be particularly heavy for highly qualified and well-paid skilled workers. This is because the contribution ceilings have increased twofold. Holznagel further explained that, in addition to the percentage increases, the government is imposing an additional €300 monthly for health and long-term care insurance premiums, though there is no increase in the services provided by these institutions.
The head of the association criticized the tax reform, deeming it unambitious. He pointed out that for the first time since 2016, the government intends not to compensate for inflation within the income tax scale. Consequently, the tax relief scheduled for 2027 will be minimal.
