The Left Party has uncovered a legal tax loophole that exacerbates wealth inequality between East and West Germany. In the eastern states, there has been no inheritance or gift of business assets exceeding 26 million euros in the past five years. All 105 applications for tax relief since 2021 originate from the old West German territory.
The Left Party has highlighted the persistent wealth gap between East and West Germany based on a response from the federal government to an inquiry by its leader, Jan van Aken. The documents are available to the RedaktionsNetzwerk Deutschland (RND). In the eastern states, no inheritance or gift of business assets exceeding 26 million euros has been reported in the past five years.
Individuals inheriting or receiving as a gift such high-value business assets can apply for tax relief if the tax cannot be paid from their own liquid assets. This so-called exemption needs assessment has been conducted in 105 cases since 2021, with the majority involving gifts. All cases concerned the old federal territory, including Berlin.
Jan van Aken, a Bundestag member and Left Party leader, told RND: "We have uncovered how starkly the huge fortunes in the Federal Republic are still distributed differently." He emphasized: "This shows: The rift in society continues not only between top and bottom, but also between East and West. The unjust tax exemptions following the exemption needs assessment contribute to the accumulation of wealth among the already super-rich - and they are exclusively located in the West of this republic."
Van Aken described the exemption needs assessment as a "legal tax loophole" and called for its abolition. "This nonsensical preferential treatment of super-rich must be ended," he told RND. The Left Party sees this mechanism as a continuation of economic inequality since reunification.
