2024-11-06 21:26:38
Economy
Finance
Politics

Significant Increase in Contribution Assessment Limits Announced

Image used under license from Shutterstock.com

The German government has approved a substantial increase in the contribution assessment limits for social insurance, set to take effect in 2025. This decision, passed by the cabinet, will see the thresholds for health and nursing insurance rise from 5,175 euros to 5,512.50 euros. Similarly, the limits for pension and unemployment insurance will increase uniformly to 8,050 euros across Germany.

This adjustment reflects a 6.44% rise in gross wages observed nationwide last year. The regular recalibration of social insurance calculation parameters ensures that high earners contribute proportionately to the system, maintaining fairness in financing. This move primarily impacts top earners, who will face higher social contributions, potentially up to an additional 187.40 euros monthly.

While the decision aligns with wage growth, it has sparked debate. The Free Democratic Party (FDP) has expressed opposition, advocating instead for tax relief measures. They argue that the adjustment should be accompanied by a faster increase in tax brackets, currently lagging behind wage growth. Despite initial resistance from the Finance Ministry, the regulation was successfully pushed through by the Labor Minister.

The regulation now awaits approval from the Bundesrat, with a decision anticipated by late November. The increased contribution limits aim to ensure equitable participation in social insurance funding amid ongoing discussions on tax reforms and economic adjustments to inflationary pressures.

zeit
6. November 2024 um 12:21

Social Security: Cabinet Approves Higher Social Contributions for High Earners

Politics
Economy
The federal government has decided to increase social contributions as proposed by the Federal Minister of Labor. However, the Federal Ministry of Finance stipulated that the Bundestag must first pass the tax relief plans of Minister Lindner (FDP). The Greens still have reservations regarding the adjustment of tax rates to inflation, which is part of the legislation.
sueddeutsche
6. November 2024 um 15:08

Social Security Contributions: Top Earners Must Pay Significantly More

Economy
Politics
Finance
Top earners in Germany will have to pay significantly higher social security contributions in 2024. The contribution assessment limits for health insurance, long-term care insurance, pension insurance, and unemployment insurance will be raised. Additionally, contribution increases are planned for 2025.
Tagesschau - Wirtschaft und Börsen-Nachrichten
6. November 2024 um 15:59

Federal Cabinet Decides on Higher Social Security Contributions for High-Income Earners

Politics
Economy
Finance
The Federal Cabinet has increased the contribution assessment limits in the social insurance system after a long dispute. The increase was initially blocked by the Federal Ministry of Finance, but was pushed through by Federal Labor Minister Hubertus Heil (SPD). Finance Minister Christian Lindner (FDP) wanted to implement changes in tax law, which led to protests.
tz
6. November 2024 um 17:28

Ampel Decides on Higher Social Security Contributions: Expensive Changes to Pensions, Long-Term Care, and Health Insurance from 2025

Politics
Economy
The traffic light coalition government decided on higher social security contributions from 2025 with a significant increase in the contribution assessment limits. Top earners will have to pay up to 187.40 euros more per month. According to VdK President Bentele, average earners are already paying 19.2% of their income for pensions, health, and long-term care insurance, while higher earners only contribute 13.5%.
CW

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