2023-07-01 06:03:51
Due to the increase in statutory pensions on July 1, more than 100,000 retirees will be subject to income tax. According to a report by the Funke media group on Thursday, the Federal Ministry of Finance assumes that the number of taxable pensioners will increase by 109,000 as a result of the adjustment.
Accordingly, the ministry also emphasized that, conversely, the increase in the basic tax allowance to EUR 10,908 on January 1, 2023 eliminated a total of 195,000 retirees from tax liability.
In total, almost six million people with pension income are subject to tax in Germany.
Tax revenues increase by 660 million euros
According to the Funke newspapers, the Ministry of Finance also assumes that the increase in pensions will increase the state’s tax revenue by 660 million euros. Due to the adjustment of the tax rate 2023 as part of the relief packages, pensioners would in turn be better off by almost two billion euros.
The statutory pensions of around 21 million retirees will rise sharply on July 1: the plus is 4.39 percent in the west and 5.86 percent in the east. This means that the current pension value is the same in West and East. “I am particularly pleased that the east pension adjustment is being achieved a year earlier due to the positive development,” said Federal Labor Minister Hubertus Heil (SPD).
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“Following the significant pension adjustment last year, there will also be an increase for pensioners this year. Rising wages and the strong labor market make this increase possible,” said Heil. The government will secure the stop line at the 48 percent pension level beyond 2025 “so that the statutory pension remains reliable”. The next pension adjustment is scheduled for July 1, 2024.
Gundula Roßbach, President of the German Pension Insurance Association, said that the rising pensions will significantly reduce the high price increases for the 21 million pensioners. In retrospect, there has been a significant increase in pensions for retirees since 2010, because pensions have increased by over 32 percent in the west and by over 47 percent in the east by 2022. (AFP/epd)
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