A basic inheritance of 60,000 euros should relieve the poor, and the richest should pay for it: What is behind the Jusos’ proposal?
Bremen – Will there soon be a basic inheritance for everyone over 18? The SPDYoung talent organization Jusos wants to demand a basic inheritance of 60,000 euros for all adults at its federal congress in mid-November. The organization’s deputy federal chairwoman, Sarah Mohamed, said this on Wednesday (October 1, 2023). Daily Mirror. According to the newspaper, the chances of the proposal being accepted are good. The payment should therefore be financed through inheritance tax.
Wealth always stays in the same families – “Different lives from month to month”
“The idea of a society in which work is the driving force for prosperity is becoming a legend under the current system,” Mohamed told the newspaper. “A basic inheritance, accompanied by further measures, can help break this vicious circle.” According to the application by the Jusos federal executive board, which Daily Mirror If this is the case, this basic inheritance should only be linked to residence in Germany and should be paid out regardless of residence status.
What is the basis for the Jusos’ proposal? The young comrades mention the massive wealth inequality in Germany. Because inheritance taxes are too low, more and more wealth remains in individual families, Mohamed told the Daily Mirror. Others, however, can barely survive. “Many others live from month to month and are happy if repairing a broken washing machine doesn’t leave them starving the next month.”
SPD East representative Carsten Schneider is also demanding “starting capital” of 20,000 euros
A broad majority is expected to support the proposal at the Federal Congress from November 17th to 19th, even if the costs would run into the billions: According to the association’s calculations, this amounts to 45 billion euros. To finance the plan, inheritance tax is to be increased to ten percent, with a tax allowance of one million euros. The tax rate should be progressive, so that the second million would be taxed at 20 percent and the third million at 30 percent. From the ninth million onwards, a top tax rate of 90 percent would apply.
According to the Jusos, a simple calculation: “For this, not even 15 percent of the approximately 400 billion euros that are inherited annually without benefit need to be collected and redistributed through inheritance tax.” The idea is already finding supporters outside of the Young Socialists. The Eastern Commissioner Carsten Schneider recently called for “starting capital” of 20,000 euros for all 18-year-olds in Germany. There was criticism of this from the FDP and the Left. Loud Daily Mirror The topic is not just one for the next SPD generation: the SPD Mecklenburg-Western Pomerania also wants to debate the basic inheritance at the SPD federal party conference in December.
Wealth inequality is particularly serious in Germany
The basic heritage model was developed by the German Institute for Economic Research (DIW) in 2021. According to the economic researchers, depending on how it is designed, the measure could reduce the Gini coefficient – the level of economic inequality in the country – by five to seven percent. The economist Marcel Fratzscher, president of the institute, made a plea in an article at the 2022 Time for a basic inheritance of 20,000 euros. In hardly any other country in the Eurozone is wealth inequality as great as in Germany. The conditions are only similarly unequal in Austria. (cgsc with afp)
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