Billions from CO2 tax: Heil plans “climate money” for everyone with less than 4000 gross

Billions from CO2 tax
Heil plans “climate money” for everyone with less than 4000 gross

The relief package recently decided by the traffic light coalition does not come close to compensating for the additional costs for the population caused by inflation and increases in energy prices. Social Minister Heil wants to follow up with further measures. Not only people with low income should benefit from this.

Labor and Social Affairs Minister Hubertus Heil plans to introduce a social climate allowance for people with a monthly gross income of less than 4,000 euros in order to relieve low and medium incomes from rising energy and food prices. In addition, the standard rates for the recipients of the new citizen’s income should increase by 40 to 50 euros per month, as Heil told the newspapers of the Funke media group. Both projects are to be implemented by January 1, 2023.

“We have to give an answer that goes beyond the current relief package,” said Heil. “I am firmly convinced that we need permanent and targeted relief for everyone with low and middle incomes.” With the introduction of a social climate money, he wants to ensure that there is a social balance.

According to the minister, the climate money should be paid out once a year and “benefit people who earn less than 4,000 euros gross as single people and less than 8,000 euros gross a month as married people”. The exact staggering is still to be discussed in the coalition. It is important to design the climate money “socially graded – according to the principle: those who need it most get the most,” said the minister. “Those who earn a lot get nothing.” For high earners, high prices are “also an annoying thing, but they can deal with it”.

“We’re talking about double-digit billions”

On January 1st, the new citizens’ allowance should also be introduced, “with which we will overcome the Hartz IV system and give the welfare state a new face,” announced Heil. It must “also be about the fact that the services are appropriate”.

The previous calculation of the standard rate no longer withstands the price development, stated Heil. “My suggestion is that we take the bottom 30 instead of the bottom 20 percent of income as a basis for family households. This will enable us to achieve that the standard rates of basic income per person and month will be around 40 to 50 euros higher than in of basic security.”

It is still a question of model calculations, “but we are already talking about amounts in the tens of billions,” said the minister. This is a financial feat, but it is necessary to keep society together. The climate money is financed from the income from CO2 pricing, the citizen money is financed from taxes.

However, Heil rejected calls for a reduction in VAT on energy and food. At the same time, the minister turned against demands that citizens should restrict themselves more in view of the rising prices. “Saving energy is always a good idea – if only because of climate protection. But I am against us making this question an individual destiny.” If you have a low income, you cannot simply buy a new heating system or an electric car.

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