Enhancing tax benefits targeted towards families with children: "Family policy should be the core focus in our society"
In an effort to combat the declining birth rate, particularly in Thuringia, a proposed family tax reform has been put forward. The reform, submitted to the Thuringian state parliament in June by the CDU, SPD, and BSW, aims to provide families with the financial support they need to raise children [1].
Claudia Heber, the CDU's spokesperson on family policy, is at the forefront of this initiative. She expresses concern about the impact of the declining birth rate on middle-class families with children, citing figures from the Federal Statistical Office [2]. Heber emphasizes the need for a tax system that considers the future burdens of families with children and advocates for structural tax relief rather than symbolic politics that may later result in financial burdens [3].
The proposed reform introduces several changes designed to make raising children more affordable. From January 1, 2025, the federal child benefit is set to increase by €5, rising further by €4 from January 1, 2026 [1]. Additionally, the basic tax-free allowance and the child allowance are being raised, with the basic allowance increasing from €11,784 to €12,096 in 2025 and to €12,348 in 2026, and the child allowance from €6,612 to €6,672 in 2025 and €6,828 in 2026 [1]. The exemption limit for the solidarity surcharge is also increased, allowing families greater tax relief overall [1].
These measures are aimed at reducing the tax burden on families and increasing direct child-related benefits, thereby encouraging higher birth rates by financially supporting families with children [1]. The gradual increases over two years reflect a political compromise aimed at providing immediate, albeit truncated, relief rather than more extensive reforms that could not secure a majority [1].
Heber also proposes the development of the marriage tax split into a genuine family tax split, advocating for a fundamental reform of family taxation within the Thuringian state parliament [4]. This reform reflects a broader federal approach to counter declining birth rates by bolstering family finances through tax and benefit improvements.
Studies by the Max Planck Institute for Demographic Research indicate a correlation between higher per capita income and higher birth rates within the European Union since the 2010s, under the right conditions [5]. The new Thuringian state government and the new federal government have announced their intention to address demographic challenges decisively [6].
In Thuringia, the birth rate has reached a historic low of 1.24 children per woman, a seven percent decrease from the previous year [7]. The birth rate nationwide has fallen to 1.35 children per woman, a drop of two percent [8]. The declining birth rate remains a concern, particularly in Thuringia, as supported by figures from the Federal Statistical Office [9].
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The proposed family tax reform, driven by Claudia Heber, aims to address the concerns of middle-class families with children by reducing the tax burden and increasing direct child-related benefits, falling under the policy-and-legislation umbrella of Thuringia's politics. This reform is part of the general-news focused on combating the declining birth rate, reflecting broader federal approaches that consider the impact of financial burdens on families.
