Merz in front of the coalition socket: does the end of the solidarity surcharge threaten?

Merz in front of the coalition socket: does the end of the solidarity surcharge threaten?

Karlsruhe, Deutschland - Friedrich Merz, the newly elected Chancellor of Germany, is planning to form a new government until Easter. As derwesten.de reports, a coalition with the SPD could be the only implementable majority. However, this step is affected with uncertainties, especially with regard to a forced judgment of the Federal Constitutional Court, which is to be made on March 26 and could burden the coalition negotiations between Merz and SPD boss Lars Klingbeil.

Merz received a clear government mandate in the Bundestag election, but the BSW failed at the five percent hurdle, which increases the likelihood of cooperation with the SPD. The government is currently under the pressure to create a draft budget for 2025 that should have been available by the end of 2024. The previous budget draft could not be finalized due to internal conflicts by the traffic light government. Therefore, the new government is currently working with provisional housekeeping.

The solidarity surcharge in the focus

A central topic that could put a strain on the coalition talks is the solidarity surcharge. This surcharge for income and corporation tax as well as capital gains was introduced to finance the costs after German reunification and is 5.5 percent. Since 2021, only better earners, companies and investors have been obliged to pay this surcharge, 90 percent of the taxpayers have been relieved. Currently, the budget draft for 2025 revenues of 12.75 billion euros from the solidarity surcharge are planned.

The judgment of the Federal Constitutional Court precedes a constitutional complaint from six members of the Bundestag of the FDP, which considered the contract as unconstitutional. They argue that the "construction east" has been completed and demand the immediate abolition of this surcharge. In the event of a decision in favor of the plaintiffs, the Merz cabinet could be confronted with additional costs of up to 65 billion euros, since the court could also order recovery for income since 2020, such as Zeit.de explained.

The legal foundations of the solidarity surcharge

The procedure before the Federal Constitutional Court has a long history. The solidarity surcharge was introduced to finance German unity in 1991 and was originally limited until 1992. It has been raised several times over the years and recently deleted in the coalition agreement of 2018 for 90 percent of taxpayers, a step that was implemented in 2021. Currently, about six million people and 600,000 companies still pay this surcharge, as well as mdr.de informed.

The upcoming decision of the Federal Constitutional Court could have far -reaching consequences for future tax policy in Germany. There are doubts as to whether the collection of the solidarity surcharge was bound to the Solidar Pact II. Both supporters and opponents of the contract argue that the legal foundations must be critically questioned. Citizens and future governments have to adapt to a possibly fundamental re -evaluation of the tax structures.