After sometimes heated debates, the Bundestag voted on several legislative projects of the traffic light coalition. An overview of the most important decisions:
The Bundestag has launched the citizens’ allowance planned by the traffic light coalition. SPD, Greens and FDP voted with their majority for the law. Citizens’ income is to gradually replace the current Hartz IV system at the turn of the year. However, this still requires approval in the Bundesrat, which is expected to decide on Monday. The Union has threatened to block citizen’s income there because it believes it reduces motivation to take up work.
48 million taxpayers are to benefit from the law passed in the Bundestag. The effects of high inflation on income tax – the so-called cold progression – should thus be completely offset. This increases the basic tax-free allowance, and the top tax rate should only apply to higher incomes. In addition, the child benefit will be raised to a uniform 250 euros per month and child. That means a plus of 31 euros for the first and second child and a plus of 25 euros per month for the third child.
In future, landlords will in many cases have to contribute to their tenants’ climate tax for heating. The so-called CO2 price is divided between tenants and landlords according to a tiered model. The less climate-friendly the house is, the more the landlord has to take on. So far, tenants have had to pay the levy that has been in place since 2021, which is intended to help reduce climate-damaging carbon dioxide emissions.
More households in Germany are to be relieved from January with a state rent subsidy: up to 1.4 million more households are to be added to the 600,000 housing benefit households so far. The housing allowance is also to be increased by an average of 190 euros per month. This means that eligible households will receive an average of around 370 euros per month in the future.
