SPD Secretary-General advocates for comprehensive reform of the welfare state within a decade
In a bold move, SPD General Secretary Tim Klüssendorf has put forth a comprehensive reform proposal for Germany's social security system. The proposed reform aims to address the current issues in the system, particularly the growing inequality in wealth distribution.
Klüssendorf has advocated for the reactivation of the wealth tax, a levy on high net worth individuals that generates high annual yields. However, he did not mention a specific timetable for its implementation. The proposed wealth tax rate would range between 1% and 2%.
One of the key aspects of Klüssendorf's proposal is the end of tax-free wealth transfer to children through repeated gifts. He believes that anyone who inherits a company worth a significant amount should take responsibility by paying the inheritance tax. Klüssendorf has also proposed a lifetime allowance for inheritance and gifts, with taxes imposed on amounts exceeding a certain sum. He did not specify the exact amount of this lifetime tax-free limit but targets particularly inheritances over €26 million for higher taxation.
In an attempt to protect small and medium inheritances, Klüssendorf has proposed combining all tax-financed social benefits for citizens into a single system. This single system would merge citizen's income, housing benefit, and child supplement.
Klüssendorf has also criticised that over half of the people in Germany do not inherit, and he did not propose any measures to increase the number of people inheriting. Instead, he aims to end the 'responsibility confusion' in the social security system by intervening in tax policy regarding inheritance tax. He has proposed abolishing special rules for inheritance tax on business assets over €26 million.
The proposed reform is part of a fixed timetable with stages, ensuring a structured approach to the implementation of these changes. However, the success of the SPD and Union in the future elections is uncertain, and the implementation of Klüssendorf's reform remains to be seen.
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