Cold progression: Federal government should follow Austria’s example
Straubinger daily newspaper
Straubing
The so-called cold progression makes some taxpayers look stupid. Namely when he earns more money, for example through a wage increase, and still ends up with less. The reason is the progressive tax rate in Germany, according to which you pay more taxes the more you earn. If there is also a high rate of inflation – as is currently the case – the result is that citizens can afford less of their net income than before.
It is therefore good that the issue is now on the political agenda. (…) Politicians don’t have to look far for inspiration: Austria is already further along with the problem. From 2023, according to plans by the ÖVP-Green coalition, an annual inflation report by economic institutes is to be determined by which amount the tax tariff levels will be adjusted. This is to prevent citizens from slipping into a higher tariff level due to a wage increase, having to pay more taxes than before and thus having less net from the gross than before. (…) The federal government should take this as an example.
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Original content from: Straubinger Tagblatt, transmitted by news aktuell