Good news for consumers. The coalition has agreed to increase the saver lump sum as of January 1, 2023 to 1,000 euros for singles and to 2,000 euros for married couples assessed together. Previously, the limit was 801 euros and 1602 euros. Capital gains, for example from dividends that do not exceed the tax exemption, do not have to be taxed.
There is nothing in the coalition agreement on the final withholding tax. This indicates that the status quo will be maintained, which should be good news for most German citizens. “It is positive that plans to abolish or increase the withholding tax cannot be found in the contract,” says Marc Tüngler, the managing director of the German Association for the Protection of Securities (DSW). The SPD had other ideas.
The withholding tax introduced on January 1, 2009 stipulates that income such as interest, dividends and capital gains that exceed the saver’s allowance are taxed at a flat rate of 25 percent. In addition, there could be a solidarity surcharge for higher earners. The tax is automatically paid by the custodian bank to the tax authorities.
Both the CDU and the SPD planned to abolish the withholding tax in the next legislative period. Investors should tax their investment income at their personal income tax rate, which is usually higher than 25 percent. On the other hand, the FDP had always advocated maintaining the current capital gains tax.
A departure from the previous tax regime for investment income could result in higher bureaucratic effort and also carry the risk of tax increases, argues the FDP. Obviously, the Liberals with their finance minister-designate Christian Lindner prevailed.
3. Online general meetings are not a flash in the pan
Online general meetings were initially due to hardship. But they should outlast the pandemic. After the positive experience, the coalition wants to enable permanent online general meetings. In doing so, the shareholders’ rights are to be “unrestrictedly” preserved.
This is not detailed in the coalition agreement, but so far it has not been possible to ask questions spontaneously at the online AGM. An exchange with the board of directors did not materialize. Questions had to be sent in beforehand. The right to challenge was also restricted. “The format of the general meeting must not determine shareholders’ rights,” Tüngler demands from DSW.
4. Comparison portal for bank fees
The comparison portal for bank fees is overdue. According to the will of the coalition, the financial supervisory authority Bafin is now to set up a comparison website for account fees. This corresponds to a proposal by the SPD, which most recently failed due to the resistance of the Union. Actually, the EU member states should ensure by the end of October 2018 that consumers have free access to at least one website that enables the fees for a current account to be compared. The fees differ significantly between the institutes. The aim is to increase competition through more transparency.
The attempt by the federal government to find private interested parties as operators ended in disaster. The Check24 portal received the necessary certification and meets the legal requirements. But when consumer advocates filed a lawsuit against Check24 because of insufficient coverage of the market, Check24 withdrew. In the meantime, Stiftung Warentest has covered the gap.
5. Residual debt insurance
For consumer advocates, residual debt insurance is the epitome of excessive commission. They are intended to offer customers protection when concluding a loan agreement. In the event of unemployment, occupational disability, illness or death, these insurances should take over. In the coalition agreement of the Ampelkoalition it is stated that the conclusion of the insurance contract and the conclusion of the loan agreement should be decoupled by at least one week.
Too often, consumers got the impression that the loan agreement cannot be obtained without insurance. The coalition of the Union and the SPD had already agreed to cap acquisition commissions for residual debt insurance. In a market study by the financial supervisory authority Bafin, twelve banks stated that they received 50 percent of the insurance premium as commission, in exceptional cases it was even more than 70 percent.
6. Credit Scoring
The traffic light coalition wants to examine how the transparency of credit scoring can be increased for the benefit of those affected. “We will implement recommendations for action promptly,” says the coalition agreement. With this, the coalition is reacting to a certain unease among consumers towards credit agencies. If you want to take out a loan, buy a car or a cell phone, banks and businesses ask credit agencies such as Schufa about the customer’s creditworthiness.
This is communicated to you in the form of a score value. This indicator shows the probability that someone will be able to meet their obligations. However, it is not always clear how these score values come about. This is where the coalition obviously wants to start.
7. Statutory pension insurance
The new government is trying to get started with the funded financing of the statutory pension insurance – at least partially. A “share pension” is still a long way off, but a start has been made.
Specifically, the Deutsche Rentenversicherung is to receive a capital stock of ten billion euros from budget funds in 2022. According to the coalition agreement, this fund is to be administered by an independent body under public law and will invest the funds globally. The idea behind it: The money should be used to make use of potential returns on the capital market.
8. Private and company pension schemes
With the Riester pension introduced in 2002, the federal government wanted to encourage private individuals to make provisions for old age – with state funding. In view of the falling pension level, pension gaps are inevitable. But the attractiveness of the Riester pension is limited. The new federal government is now striving for a fundamental reform.
“We will examine the offer of a publicly responsible fund with an effective and inexpensive offer with the option of opting out,” says the coalition agreement.
Consumer advocates consider the “test” to be a waste of time, since the shortcomings are obvious and suggestions are already available. A need for reform is also seen in company pension schemes, the third pillar of old-age provision. The aim is to enable the sponsors to invest in asset classes that promise higher returns.
More: Alliance of great promises: This is what the new coalition for taxes, growth and climate brings.