Enhanced social security payments require increased contributions for higher earners, proposed in new legislation. - Advocates Push for Increased Social Contributions from Higher-Earning Individuals (Leftist Perspective)
Top Earners Faced with Calls for Higher Social Contributions in Saxony
The left-wing party in Saxony is advocating for increased social contributions and taxes from high-income earners to finance the social system. Susanne Schaper, the party and faction leader, expressed her belief that individuals with annual incomes of six or seven figures ought to make higher social contributions and pay more tax. An inheritance tax is also proposed.
Schaper maintains that such measures aren't detrimental to individuals but instead enhance overall wealth. She asserts that these measures are essential to create a more equitable country, invest in long-term infrastructure, and maintain the functionality of the commonwealth. Initial reports of this proposal appeared in the "Sächsische Zeitung" and "Leipziger Volkszeitung."
Schaper referenced the contribution assessment limits, stating that contributions for pension and unemployment insurance are only applicable for annual incomes up to €96,600, while for health and long-term care insurance, the limit stands at €66,150. Beyond these limits, additional income is contribution-free.
According to data obtained by Schaper, Saxony had 499 income millionaires in 2022, a significant increase from 230 in 2014. The individual with the highest income earned nearly €24 million in 2022, with total income millionaires accounting for more than €1.2 billion.
The Left has also criticized the tax administration for only scrutinizing a fraction of million-dollar incomes. Only less than 30% of these incomes have been audited since 2014, with checks on just 4% and 1% of affected individuals in 2021 and 2022, respectively. The Left considers this practice unacceptable, especially given the substantial sums involved.
In comparison to approximately two million taxpayers in Saxony, the number of income millionaires is relatively small. While Saxony hosts fewer top earners compared to other federal states like Bavaria, North Rhine-Westphalia, and Baden-Württemberg, the state remains home to many millionaires.
Social contributionsSaxonyTop earnersThe LeftSusanne SchaperDresdenSächsische ZeitungLeipziger Volkszeitung
In the context of social contributions in Saxony, employer and employee contributions are split differently than in most other German federal states. The employer's contribution for full long-term care insurance is 1.2%, lower than in most other states, while employees contribute a comparatively higher share. Social security contributions are capped at a contribution assessment limit, meaning high earners do not pay additional contributions on income above €7,450 per month (East Germany’s cap for 2024). Overall, current policies focus on maintaining these contribution caps and defined employer-employee split structures.
- Following the call from The Left in Saxony, led by Susanne Schaper, the community policy is under scrutiny, particularly focusing on proposing increased social contributions and taxes for top earners, as a means to finance the social system.
- In the general news and regional publications such as "Sächsische Zeitung" and "Leipziger Volkszeitung", the proposal to implement new policy-and-legislation involving higher social contributions for high-income earners in Saxony has been discussed, with the aim of creating a more equitable country and maintaining the functionality of the commonwealth.
){kind=link}