Tax relief 2024: How do employees and self-employed people benefit?

Tax relief 2024: How do employees and self-employed people benefit?

According to a report by www.merkur.de, The new year begins with good news for employees and the self-employed. You can expect more net than gross. Despite fluctuations, there are a few hundred euros for almost everyone.

The Federal Finance Minister Christian Lindner (FDP) has earmarked tax relief amounting to 35 billion euros. These include increasing the basic tax allowance from 10,908 to 11,604 euros, increasing the child tax allowance from 6,024 to 6,384 euros and adjusting the tax rates to the inflation rate. This is intended to protect taxpayers from so-called cold progression. In addition, the exemption amount for the solidarity surcharge, from which the solidarity surcharge becomes due, increases.

According to financial scientist Frank Hechtner from the University of Erlangen-Nuremberg, taxpayers with different incomes can benefit from the relief. A single with a monthly income of 3,000 euros can expect relief of 172 euros per year, while a single with an income of 5,000 euros will have 292 euros more net of the gross. Families with children also receive relief, although the amount of relief depends on the partners' incomes.

However, the tax relief is partly eaten up by rising social security contributions. The additional contribution for statutory health insurance and the increase in the contribution assessment limits for pension and unemployment insurance as well as statutory health and nursing care insurance lead to higher taxes.

Overall, according to experts, there is still a decent plus for many taxpayers. Further relief is planned for the middle of the year, depending on the adjustment of citizens' allowance. However, this is still the subject of intensive discussions in the federal government.

Overall, the tax relief described can have a positive effect on the market and the financial sector. The higher net income of taxpayers could lead to higher consumer spending and investment, which could have a positive impact on economic development. However, rising social security contributions should also be taken into account as they could have the opposite effect. It is important that financial experts continue to closely monitor developments in order to adapt their forecasts and recommendations to the financial industry.