Social security contributions How they eat up the tax cuts again

Berlin After the cabinet meeting on Wednesday, Christian Lindner (FDP) did something unusual: he made a statement for the cameras. The finance minister emphasized the relief that the federal government had initiated shortly before.

But while the head of the FDP and the traffic light politicians are publicly celebrating the planned relief, the federal government is working on burdens elsewhere. Only that the responsible Labor Minister Hubertus Heil (SPD) does not speak publicly about it so extensively. Because half of the large tax cuts are eaten up again by higher social security contributions. Above all, employees with higher incomes will have to adjust to significantly increasing social security contributions of more than 600 euros next year.

This is the conclusion reached by finance scientist Frank Hechtner from the University of Nuremberg-Erlangen, who calculated burdens and relief for various incomes for the Handelsblatt newspaper. “A not insignificant part of the intended relief will be eaten up again by the increase in social security contributions,” says Hechtner.