Back in 1991, under Chancellor Kohl.....a solidarity surcharge tax (Solidaritaetszuschlag) was created. It was a extra fee on regular on normal income tax, capital gains tax and corporate tax in Germany.
The cash flow....was meant to upgrade and 'help' East Germany intergrate into West Germany. To be honest, at the time, a ton of DM's were required and this was the only way to make sense out of the funds requirement. Added to this....Kohl said (written into stone)....it was created with wording to indicate in 2019....it would end. Yeah, it was roughly a 30-year tax.
So what happened in 2020? Some text was added, and it remains. Well...technically it remains.
There's a court case brewing in the German Fiscal Court....saying that the 11-billion Euro collected per year.....is illegal, and the money collected from 2020, 2021, and 2022....would have to be paid back.
33-billion Euro? Yes.
Added to this....the wording in court says 'rights were violated'....so damages would fall into play....if they were to win.
There are differing perceptions about how this could go, and it might only lead onto the Constitutional Court.
The gov't having 33-billion Euro to send back to companies and people? Not really.
The gov't having trouble to create a budget, if this went away? Yeah....that's something to openly discuss.
The court likely to say it's all legit? I think there's political pressure here, and that the term 'solidarity' has to go away.
The one odd piece of the discussion? When you sit and examine the tax....it's mostly designed for the well-to-do in Germany. So if you were at the middle of the working class....you pay little to nothing into the pot. So in truth....it was a wealth tax when created and is still a wealth tax today.
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