Taxation on married couples is anti-growth


According to official figures, there are almost ten million married couples in Germany without children.

(Photo: dpa)

Smart politics is characterized by finding the right time in enacting new laws. However, it is hardly less important to abolish laws again if the framework conditions have changed or if the law has, contrary to expectations, proven to be ineffective.

The fact that this is often forgotten by politicians is manifested not least in the increasingly extensive catalog of state subsidies, the volume of which the Institute for the World Economy recently estimated at a record value of 206 billion euros.

The thicket in family policy is no less dense, but much less noticed. An overall evaluation commissioned by the Ministry of Family Affairs a few years ago revealed more than 150 individual measures, the total volume of which amounted to around 200 billion euros per year. If a family is defined as a “shared flat with at least one minor child”, this corresponds to around 17,000 euros for each of the 11.6 million families.

Probably the most important reason for the proliferation of family policy benefits is that the family policy model has changed several times over the past 70 years, and with it the funding framework – without the funding measures corresponding to the traditional models being dropped.

Spouse splitting is an example of this. Marriage and the family have been protected by the Basic Law since 1949. According to the understanding of the time, single-earner marriage was the norm and rule. The marriage was usually quickly followed by the birth of usually several children who were looked after by the housewife who was not gainfully employed, while the husband, who was usually better qualified, was responsible for earning the household income.

Against this background, it was logical that in 1957 the Federal Constitutional Court ruled that two people who marry should not be discriminated against by the tax authorities and that married couples with the same household income are subject to the same tax burden even if their income is distributed differently between both partners.

With a tax tariff with increasing marginal tax rates, both requirements of the Constitutional Court can only be guaranteed by splitting the spouses. Marriage is understood as an economic community and the tax liability therefore depends solely on household income.

The income of both partners is added up and then halved. The tax rate is applied to this halved amount and the result is doubled.

It is implicitly assumed that both partners contribute equally to the household income. As a result, the tax liability of a married couple is lower than that of two unmarried people with the same income.

Less childless marriages

The chief economist

Author Prof. Bert Rürup is President of the Handelsblatt Research Institute (HRI) and Chief Economist of the Handelsblatt. For many years he was a member and chairman of the Advisory Council and advisor to several federal and foreign governments. More analyzes, comments and studies by Professor Rürup and his team at

The times have changed. Today marriage is by no means synonymous with family. According to the official figures, there are almost ten million married couples without children.

There are 11.6 million parent-child communities with underage children, which include married couples as well as unmarried same-sex and mixed-sex unions and single fathers and mothers with unmarried children in the household. Family tax incentives, which are linked to the fact of marriage, mean that many households with children go away empty-handed, while many other unions without children benefit from it.

The criticism of splitting is not primarily directed against its lack of target accuracy, but arises from two other aspects: On the one hand, the splitting advantage is greater, the more different the incomes of both partners are.

Today the maximum splitting advantage is around 18,000 euros per year. This amount occurs if one partner has nothing and the other has a taxable annual income of 540,000 euros or more.

For such couples, marriage is very rewarding from a tax point of view, while married couples where both partners earn the same income receive no preferential treatment. Many perceive this to be socially unjust, even if it is in the nature of a progressive income tax rate that the higher the income and thus the tax burden, the greater the tax relief.


More serious is the objection that splitting reduces the number of jobs and thereby consistently disadvantages women. The reason: The second earner in a marriage – mostly the woman – is confronted with very high marginal burdens. In addition to the full social security contributions, high taxes are due from the first euro.

High hurdles for mini jobbers

Both together lead to deductions that can quickly exceed the 50 percent mark even with lower incomes. Regardless of their high participation in education, many women therefore flee to 450-euro jobs, which remain tax-free for employees.

However, the transition from a mini job to a regular employment subject to social insurance is associated with a marked increase in the compulsory tax burden. Thus, the hurdle before transitioning to a regular employment relationship is too high for many mini-jobbers.

Germany is now facing a massive aging surge that will begin in the middle of this decade and last for a good two decades. This will cover all areas of the economy and society and cause problems that politicians have to face.

Skilled labor shortage is increasing

In view of the irreversible aging of the population, Germany is heading for a massive shortage of skilled workers. It should therefore become a maxim of all political decisions to refrain from anything that restricts the supply of jobs.

If it were possible to increase the supply of jobs and also improve the investment climate, after the end of the corona pandemic it could possibly be possible to lift the economy from the currently downward development path to a higher growth path. The reform of the traditional spouse splitting could be a component of a strategy with which the labor force participation of often very well qualified women can be increased and thus the overall economic labor supply can be increased.

It is high time to prepare for the irreversible aging spurt.

More: In view of the imminent surge of aging, securing prosperity must be a priority for politics in Germany, says Bert Rürup.


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