Federal Finance Minister Christian Lindner is sticking to his plans for tax relief by reducing the so-called cold progression in income tax. According to a media report, he wants to relieve taxpayers by 10.1 billion euros in 2023.
Federal Finance Minister Christian Lindner (FDP) wants to relieve taxpayers of 10.1 billion euros in the coming year in view of the increased prices. The news magazine “Der Spiegel” reported on Monday about corresponding plans and also gave the first figures on possible tax cuts and an increase in child benefit. The 43-year-old wants to present Lindner’s concept, which envisages a further relief step of around four billion euros for 2024, this week.
First of all, the basic tax allowance is to increase from the current 10,347 euros to 10,633 euros in the coming year and 10,933 euros in 2024. The top tax rate, which currently applies to taxable income of EUR 58,597, will only start at EUR 61,972 in the coming year and at EUR 63,521 a year later. Starting next year, the new income tax rates should also take inflation into account. Lindner’s tax experts are assuming an inflation rate of almost six percent in 2022, and they assume increases of 2.5 percent for the next year.
According to the “Spiegel” report, child benefit for the first two children will increase by eight euros to 227 euros in 2023. For the third child, parents get two euros more, then also 227 euros. For the fourth child it remains at 250 euros. In the following year, the child benefit for the first three children is to increase again by six euros. The federal and state governments should each bear 42.5 percent of the financial expense for returning the charges. The remaining 15 percent is to be borne by the municipalities.
