Finance Minister Lindner is planning tax breaks for 2025 due to high inflation. It is said that the basic tax exemption quota will be increased in 2025 and 2026; In addition, the child tax exemption will be increased. Even then, there isn't much taxpayer money to keep. There is still not much money in everyone's pockets. By 2025, a family of four will receive an additional €21 tax deduction.
The main content of the 2025 tax reduction policy
Treasury Secretary Lindner wants to take action against the high inflation of the past few years and ensure taxpayers have more money in their pockets with new tax breaks. According to Lindner's two reports to his cabinet colleagues, it can be learned that his tax cut plan mainly involves two main parts: basic tax exemption and child welfare.
- The basic allowance will increase to €12,096 in 2025 and will continue to increase to €12,384 in 2026.
- In addition, the child allowance will be increased by €60 to €6,672 in 2025 and to €6,828 in 2026. This is equivalent to an increase of 156 euros.
The FDP finance minister said that in 2025 the monthly child allowance will increase slightly by 5 euros to 255 euros per month. By 2026 it will increase by a further 4 euros to 259 euros per month.
Citizen income in 2025 is a zero-round increase, increasing by only 1 euro per month to 256 euros.
Unfortunately, these fiscal burden reduction policies are not a joy for a family of four. For example, if you earn 5,000 euros per month, you will be able to increase your income by about 21 euros in 2025. However, the likelihood of increased income will continue to shrink as contributions to health insurance and long-term care insurance will increase in the new year.
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The tax cut plan has also been resisted
Finance Minister Lindner said: "The federal government has made many spending requests, but we have cut by billions of euros ahead of schedule. This is done in order to "reduce the burden of the working population in a fair way."
The Social Democrats and Greens are said to be reluctant to reduce the tax burden on high-income earners and are resisting Lindner's tax cuts. But Lindner said he had "confirmed the support of the Federal Chancellor".