1. Home
  2. Studies
  3. The Taxation of Spouses in Germany: The economic impact of different reform proposals
Martin Beznoska / Tobias Hentze / Susanna Kochskämper / Maximilian Stockhausen IW-Analyse No. 133 3. December 2019 The Taxation of Spouses in Germany: The economic impact of different reform proposals

How can spouses be taxed both efficiently and fairly? It is not possible to formulate a universally valid solution to this question from a pure tax system point of view, because it depends on the underlying assumptions and norms.

Download PDF
The economic impact of different reform proposals
Martin Beznoska / Tobias Hentze / Susanna Kochskämper / Maximilian Stockhausen IW-Analyse No. 133 3. December 2019

The Taxation of Spouses in Germany: The economic impact of different reform proposals

IW-Analyse

Download PDF Quote

Copy the information

The link was added to your clipboard!

Share this article:

or copy the following link:

The link was added to your clipboard!

How can spouses be taxed both efficiently and fairly? It is not possible to formulate a universally valid solution to this question from a pure tax system point of view, because it depends on the underlying assumptions and norms.

What is striking in Germany is that fiscal and social legislation contain contradictory provisions. As amended in 2008, the law’s position on alimony suggests that a marriage’s secondary earner can become path dependent if, following the logic of income splitting, they are not, or only marginally, gainfully employed during the marriage. Simulations show the economic impact of different reform models. Limiting the present arrangement, for example, by allowing current spouses only the restricted degree of joint taxation applicable to alimony payments or by introducing individual taxation with a transferable basic tax allowance would limit the splitting effect and therefore particularly penalise marriages where one partner works only part-time or not at all. The work incentives for second earners, and thus especially for women, could only be gradually increased by switching to alternative forms of taxation without accompanying tax relief. For radical improvements, further measures would be necessary, for example relating to the supply of day care centre places and to mini-jobs and free joint-membership of the statutory health insurance system.

 

 

Download PDF
The economic impact of different reform proposals
Martin Beznoska / Tobias Hentze / Susanna Kochskämper / Maximilian Stockhausen IW-Analyse No. 133 3. December 2019

Martin Beznoska / Tobias Hentze / Susanna Kochskämper / Maximilian Stockhausen: Die Besteuerung von Ehepaaren in Deutschland – Ökonomische Effekte verschiedener Reformvorschläge

IW-Analyse

Download PDF Quote

Copy the information

The link was added to your clipboard!

Share this article:

or copy the following link:

The link was added to your clipboard!

More on the topic

Read the article
Analysis of the party programs and outlook for the coming legislative period
Martin Beznoska / Tobias Hentze IW-Policy Paper No. 19 19. September 2021

Income tax policy in the federal election campaign

Income tax policy plays a relevant role in the election programs for the German federal election 2021. According to the election programs, basically all parties are aiming for relief for small and medium incomes and for households with children.

IW

Read the article
Martin Beznoska / Tobias Hentze IW-Policy Paper No. 18 14. September 2021

An Estimate of the Potential of Inheritance Tax to Relieve the Labor Factor

In der politischen Debatte wird teilweise argumentiert, dass die Erbschaftsteuer die bessere Vermögensteuer sei.

IW

More about this topic

Content element with id 8880 Content element with id 9713