Press Release | The increase in value-added tax (VAT) currently being discussed by the federal government to cover public financing needs would be disastrous from both a distributional and economic perspective. It would primarily affect people with low and middle incomes, as well as transfer recipients. Even a simultaneous reduction of VAT on food would come nowhere near offsetting the additional burden. Domestic demand would be further weakened, with corresponding negative economic effects.

At the same time, it is clear that substantial public investment in infrastructure, education, climate protection, development cooperation, and the preservation of the welfare state is urgently needed. However, this must not be financed by increasing indirect taxes such as VAT, which exacerbate social inequality.

Instead of placing additional burdens on people with low incomes, there must be greater contributions from very large fortunes and high levels of wealth income. The suspension of the wealth tax and other tax reforms over recent decades have led to a situation in which multimillionaires and billionaires often pay only about half the tax and contribution rates of the broad middle of society, whose income is primarily derived from labor. In addition, individuals with very large fortunes benefit from extensive privileges in inheritance tax. At the same time, through their lifestyles and investment behavior, they cause extremely high levels of environmental and climate damage, the costs of which are borne by society as a whole. The tax cuts for corporations already decided by the federal government, to take effect from 2028, will further exacerbate this imbalance in favor of the super-rich.

As a coalition of social welfare organizations, environmental groups, and civil society initiatives representing several million people in Germany, we call on the federal government to immediately correct this harmful course. It must ensure that the super-rich make an appropriate contribution to financing the common good through fair taxation of very large fortunes. Only in this way can societal burdens be distributed fairly and social cohesion be strengthened.

Signatory Organizations:

• Arbeitskammer des Saarlandes
• Attac Deutschland
• ECOnGOOD | Gemeinwohl-Ökonomie Deutschland e. V.
• FiscalFuture e. V.
• Forum Ökologisch-Soziale Marktwirtschaft e. V. (FÖS)
• Gemeingut in BürgerInnenhand e. V.
• Greenpeace e. V.
• LobbyControl - Initiative für Transparenz und Demokratie e.V.
• Netzwerk Steuergerechtigkeit e. V.
• Oxfam Deutschland e. V.
• Sozialverband Deutschland e. V. (SoVD)
• Sozialverband VdK Deutschland e. V.
• taxmenow – Initiative für Steuergerechtigkeit e. V.
• ungleichheit.info e. V.
• WEED e. V. – Weltwirtschaft, Ökologie & Entwicklung