Tax burden 2024: Low and average earners will be burdened more heavily

Most taxpayers will have a higher burden in 2024 than in the previous year. This is what current calculations by the German Economic Institute (IW) have shown. Low and average earners in particular must expect a noticeable additional burden, as the institute announced today. The IW called on the traffic light government to pay citizens the promised climate money in order to adequately relieve the burden on low incomes. According to a report from www.tagesschau.de,

Which will become more expensive in 2024

With the start of the new year, numerous consumer expenses have increased. Social contributions have risen, as have the CO2 price of fossil fuels. The VAT in the catering industry is at the original level of 19 percent, as is the VAT for gas, as the IW listed. In addition, electricity became more expensive due to rising network fees. On the other hand, there is tax relief for income tax.

Single parentsit hits particularly hard

The bottom line is that a single person with an annual gross income of 50,000 euros pays 40 euros more in taxes and duties per year, the IW calculated. A family with two children and a combined gross annual income of 130,000 euros, on the other hand, will have 262 euros more at the end of the year, while a family with an annual income of 42,000 euros will have 33 euros less. Single parents with one child are hit particularly hard: According to the IW calculations, a single parent with an annual gross income of less than 36,000 euros has a loss of 144 euros.

IW: “Taxpayers have to pay for government failures”

The traffic light government “struggled for weeks to find a solution to the budget dispute,” according to the IW. The institute criticized that in the end taxpayers would have to pay for “the government’s failures and the inappropriate and unconstitutional budget policy”. The traffic light coalition had already promised climate money in its coalition agreement to compensate for the rising CO2 price. But so far there is no trace of it. Last week, economist Veronika Grimm called for the planned climate money to be introduced before the next federal election.

“Climate money should have been established from the outset – before the increase in CO2 pricing,” Grimm told the “Rheinische Post.” “Then it would be crystal clear that increasing CO2 pricing is not a tax increase, but simply a steering instrument.”