DAt their federal congress in mid-November, the Jusos want to demand a basic inheritance of 60,000 euros for everyone over 18 years old. The deputy federal chairwoman of the SPD youth organization, Sarah Mohamed, told the “Tagesspiegel” on Wednesday. According to the newspaper, the chances of the proposal being accepted are good. The payment should therefore be financed through inheritance tax.
“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 legacy, accompanied by further measures, can help break this vicious circle.”
According to the application from the Jusos federal executive board, which is available to the “Tagesspiegel”, this basic inheritance should only be linked to residence in Germany and should be paid out regardless of residence status.
Growing poverty gap
The Jusos cite the massive wealth inequality in Germany as justification. Because inheritance taxes are too low, more and more assets remain in individual families, Mohamed told the Tagesspiegel. “Many others live from month to month and are happy if repairing a broken washing machine doesn’t leave them starving the next month.”
According to “Tagesspiegel” information, a broad majority is expected for the application at the federal congress from November 17th to 19th. According to the association’s calculations, the costs for this amount to 45 billion euros.
To finance this, the Jusos are calling for an inheritance tax of ten percent from an exemption amount 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.
Regarding financing, according to the report, the application states: “For this purpose, 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 of a basic inheritance also finds 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. According to “Tagesspiegel”, the SPD Mecklenburg-Western Pomerania also wants to debate the issue at the SPD federal party conference in December.
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. In hardly any other country in the Eurozone is wealth inequality as great as in Germany. Only in Austria are the conditions similarly unequal.
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