A debate is raging within Germany's Union party over a possible increase in the top tax rate as part of tax reform. While some representatives do not rule out a higher rate for top earners, others are clearly distancing themselves. The business community is annoyed by the discussions.
Berlin. A controversy has erupted within Germany's Union party over a higher top tax rate in the context of comprehensive tax reform. Union representatives recently expressed openness in Handelsblatt to stronger taxation of top earners. On Friday, however, other CDU politicians distanced themselves from these positions.
CDU parliamentary deputy Mathias Middelberg described the proposals as 'an individual opinion.' He emphasized: 'Our line is clear: Taxes must go down, not up.' In the current economic situation, a top tax rate of 49 percent, as proposed in the concept by DIW economist Stefan Bach and discussed in the coalition, would send 'the completely wrong signal,' Middelberg said.
Politicians Fritz Güntzler and Florian Dorn also consider a rate of 49 percent too high. They do not rule out raising the current 42 percent rate to 45 percent, however, provided that the broad middle class is relieved as a result. Middelberg explicitly opposed ideas with 49 percent but did not clearly reject plans with 45 percent.
The debate is not only stirring unrest within the Union but also causing irritation in the business community. Parts of the Union no longer rule out a higher top tax rate, leading to internal party tensions.
