The Greens' plans for the super-rich: Greens want to make billionaires pay a little

A solution to two problems: The Greens want to impose an additional tax on large assets worth more than 500 million euros. This should bring more money for the federal and state governments – at least 20 billion euros per year. It could also serve justice, because today capital is often taxed much lower than labor.

The opposition party in the Bundestag calls wealth over 500 million euros “extreme wealth”. The Green financial experts Andreas Audretsch, Katharina Beck and Karoline Otte see their proposal, which they presented on Tuesday, as a pragmatic offer to the federal government. After all, the Union and the SPD are dealing with an underfinanced federal budget in which holes are opening up faster than they can be filled.

Sums over 500 million euros would therefore be taxed at a tax rate of two percent. From 1 billion euros the tax would be 3 percent, 4 percent from 10 billion euros in assets. The tariff would increase linearly between the levels.

“A worker at BMW pays almost twice as many taxes and duties as BMW heiress Susanne Klatten,” says MP Otte and asks: “In what topsy-turvy world is that fair?” The advantage for high assets comes from the fact that they are held in special management companies, invested in financial products and companies and are therefore taxed low. The Greens explain that the rich only used the smallest part for private expenses, for which they then paid normal income tax. The aim is to reduce this “tax gap” with the new wealth tax.

According to the concept, this would only affect “a few hundred people” in Germany. Medium-sized businesses don't have to worry. The Greens set the tax rates at 2 to 4 percent below the return that owners normally achieve on their capital. “During the conception, we were very careful to ensure that it definitely didn’t affect the company’s substance,” says Katherina Beck. There is therefore no reason for tax evasion, and there are no difficulties in financing start-ups either.

The SPD and the Left are also toying with a new wealth tax, which has not been levied in this country for decades. However, because the CDU and CSU reject such advances, there is currently no realistic political majority in the Bundestag.

The overall financial policy situation makes targeted increases in revenue seem entirely plausible. Although the government has enormous sums of money that it invests in debt-financed investments, exceptions to the debt brake have been decided on for this purpose. At the same time, however, money in the core budget is tight. The debt brake still applies there. The interest that has to be paid on the extensive debt is also beginning to fall.

Additionally, there are a bunch of expensive problems. Statutory health insurance and nursing care insurance are falling into the red. The pension insurance company may need higher subsidies or have to reduce benefits and increase contributions. Finally, military spending is rising sharply because the government is modernizing the Bundeswehr and supporting Ukraine, which is being attacked by Russia. The majority of this is currently being financed with new debt. But things won't last forever; the defense will then have to be paid for again from the normal budget. In view of these prospects, experts often point out that Germany taxes large assets less than comparable economic nations.