“These really hard times hit those who have little money in particular,” said the Green finance politician. She also criticized Lindner’s rejection of an excess profit tax. “In terms of financial policy, it is a mystery how this further proposal in the billions is supposed to comply with the desired debt brake if at the same time the possibilities for additional income are blocked, such as by an excess profit tax.”
On Wednesday, Lindner presented the cornerstones of an “Inflation Compensation Act”, which is particularly concerned with tax relief for citizens. Lindner wants to reduce the so-called cold progression. The term describes the effect that someone slips into a higher tax rate due to a wage increase that at most compensates for inflation and thus ultimately has less money in their pocket in relation to purchasing power.
Criticism of Lindner’s plans also comes from the Left Party. “It’s the opposite of accurate and socially unfair,” said Dietmar Bartsch, the head of the left-wing parliamentary group, to the RND newspapers. “Those who earn a lot benefit the most.”
A large tax reform financed by top earners is needed to relieve people with small and middle incomes. “The tax and duty burden is too high for low and average earners – long before the exploding energy prices,” said Bartsch.
The SPD and the Greens would also have to assert themselves against the FDP blockade on the excess profit tax and introduce a one-off property tax. “If taxes and the distribution of the costs of the crisis are not finally fairer, the country will fly apart socially,” said the left-wing politician.
An excess profit tax would affect companies that profit from the current energy crisis without their own performance. In Great Britain, for example, oil and gas companies must temporarily pay 25 percent tax on their additional profits.
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