47% tax rate on €68K income in Germany – Has it gone too far?

[Aston VIP]

Hey everyone,

I came across something recently that honestly made me pause. There’s serious discussion in Germany about applying a 47% tax rate to income starting at just €68,000.

Let that sink in!
That’s not millionaire money. That’s what many skilled professionals in IT, finance, consulting, sales, or legal make in cities like Munich, Berlin, or Frankfurt and barely keep up with rent, bills, and family costs. They’re not rich.
If this passes, Germany risks becoming one of the most unattractive places in the EU for productive professionals and business owners. And to be clear, this isn’t just about income tax, once you add health insurance, solidarity tax, and local contributions, people are already losing close to 40% of their gross.

And now they want more?

It’s not that people don’t want to pay taxes. But at some point, it starts to feel like punishment for doing well. I know many people who are now actively looking to move their residency, restructure their company, or relocate completely.

What do you think?

• Is this the final straw for Germany?
• Would you stay and pay, or restructure and move?
• Anyone here already taken action?

Curious to hear what others are doing , especially from those who’ve already gone offshore or changed tax residency in response to EU policies like this.

 

[Aetherial]

It's currently 49.5% at it's neighbor (NL) when you earn more than €73.000. It's bizarre when you think about it. One of the reasons for me being in the process of leaving in a couple of months. I'm not against tax per se, but no sane man wants to hand over half, or even more, of his income to the state.

The sad reality is I don't think much will change, being that most people are employees and are location-dependent. Plus everything is paid for as soon as you receive your salary. Now start doing that yourself by having your own company and it becomes a painful confrontation/reality check.

European governments are actively seeking to destroy smaller businesses (especially sole traders), so they don't really care if we leave.

 

[Alonzo]

Very unlikely to pass. CDU is in power and hates such proposals

Also, can you give me the link to that discussion you saw? There is already a "reichensteuer" which is the 45% tax bracket that kicks off at €277k.

 

[Aston VIP]

It's currently 49.5% at it's neighbor (NL) when you earn more than €73.000. It's bizarre when you think about it. One of the reasons for me being in the process of leaving in a couple of months. I'm not against tax per se, but no sane man wants to hand over half, or even more, of his income to the state.

The sad reality is I don't think much will change, being that most people are employees and are location-dependent. Plus everything is paid for as soon as you receive your salary. Now start doing that yourself by having your own company and it becomes a painful confrontation/reality check.

European governments are actively seeking to destroy smaller businesses (especially sole traders), so they don't really care if we leave.

Totally get where you’re coming from. We’ve actually helped so many people from NL move to Dubai that we had to bring on Dutch staff just to handle all the cases. It’s wild how common this is becoming.

Like you said, it’s not even just about the tax rate, it’s the feeling of handing over half (or more) of what you work so hard for. At some point, it just doesn’t make sense anymore.

If you ever wanna chat about how others made the move or what’s possible, feel free to reach out. You’re definitely not alone in thinking this way.

 

[Alonzo]

Hey everyone,

I came across something recently that honestly made me pause. There’s serious discussion in Germany about applying a 47% tax rate to income starting at just €68,000.

https://www.merkur.de/verbraucher/s...sen-mit-mehrausgaben-rechnen-zr-93655775.html

So SPD wants a top income tax rate of 49%, 30% WHT and a global wealth tax.

Will never happen

 

[SCHLOSSFINANZ]

it will happen, it has already agreed according to my sources. 30% on dividends, interest and capital gains will come

 

[Alonzo]

it will happen, it has already agreed according to my sources. 30% on dividends, interest and capital gains will come

The three changes that SPD proposed will never happen not each of them. I previously said that it is very unlikely they’ll increase income tax (upto 49%).

Where did you see the announcement? Can you please link the source?

 

[SCHLOSSFINANZ]

I have been given FIRST hand information from a CDU MP, there is no official source. Wait until it will be official news.
I am pointing to the increase to 30% of WHT not increase in income tax...

 

[Alonzo]

I have been given FIRST hand information from a CDU MP, there is no official source. Wait until it will be official news.
I am pointing to the increase to 30% of WHT not increase in income tax...

If legit then yikes… 31.65% flat rate is horrendous.
Tax Inferno Spain has less and is progressive

 

[polonieth]

It's currently 49.5% at it's neighbor (NL) when you earn more than €73.000. It's bizarre when you think about it. One of the reasons for me being in the process of leaving in a couple of months. I'm not against tax per se, but no sane man wants to hand over half, or even more, of his income to the state.

The sad reality is I don't think much will change, being that most people are employees and are location-dependent. Plus everything is paid for as soon as you receive your salary. Now start doing that yourself by having your own company and it becomes a painful confrontation/reality check.

European governments are actively seeking to destroy smaller businesses (especially sole traders), so they don't really care if we leave.

If you earn €100,000 in the Netherlands, you tax bill would be about €40k, crazy really. It's strange how so many people accept it, people say stuff like "it's great everything like healthcare is taken care of" etc, just pure state propaganda.

 

[Aetherial]

Totally get where you’re coming from. We’ve actually helped so many people from NL move to Dubai that we had to bring on Dutch staff just to handle all the cases. It’s wild how common this is becoming.

Like you said, it’s not even just about the tax rate, it’s the feeling of handing over half (or more) of what you work so hard for. At some point, it just doesn’t make sense anymore.

If you ever wanna chat about how others made the move or what’s possible, feel free to reach out. You’re definitely not alone in thinking this way.

Thank you, noted.

If you earn €100,000 in the Netherlands, you tax bill would be about €40k, crazy really. It's strange how so many people accept it, people say stuff like "it's great everything like healthcare is taken care of" etc, just pure state propaganda.

Yeah, and it's not even that great. I must say the healthcare you get is good quality wise but everything around it sucks. You have to pay the first €500-800 in costs yourself and the insurance is still around €170 a month. Besides the high corporate/income tax there's many more (little) things you have to pay that makes living in NL expensive. It all adds up. Random example: you get a yearly tax bill from the city you live in for collecting your trash, the sewer system etc. which was around €800 this year for me. Also, good luck finding an apartment under €1500 (or €2000 a month if you wish to live normally) in the larger cities. You actually need at least 10k a month to live a normal life where you don't just sit at home. The threshold where it is worth leaving is very low to leave.

 

[polonieth]

Thank you, noted.

Yeah, and it's not even that great. I must say the healthcare you get is good quality wise but everything around it sucks. You have to pay the first €500-800 in costs yourself and the insurance is still around €170 a month. Besides the high corporate/income tax there's many more (little) things you have to pay that makes living in NL expensive. It all adds up. Random example: you get a yearly tax bill from the city you live in for collecting your trash, the sewer system etc. which was around €800 this year for me. Also, good luck finding an apartment under €1500 (or €2000 a month if you wish to live normally) in the larger cities. You actually need at least 10k a month to live a normal life where you don't just sit at home. The threshold where it is worth leaving is very low to leave.

What are the true average salaries in the big cities? Not the ones you normally hear quoted officially. It's 10 years since I was in Amsterdam, can't say it blew me away and I assume it's only got worse.

Yeah I imagine care is ok standard if you break a leg or whatever, it's just people parrot state produced indoctrination without even thinking about it. Half of them never even use the health system, and if they ever do they typically die of the typical stuff everyone else does anyway. Most of the time you're better off self insuring and paying privately IMO.

 

[Aetherial]

What are the true average salaries in the big cities? Not the ones you normally hear quoted officially. It's 10 years since I was in Amsterdam, can't say it blew me away and I assume it's only got worse.

Yeah I imagine care is ok standard if you break a leg or whatever, it's just people parrot state produced indoctrination without even thinking about it. Half of them never even use the health system, and if they ever do they typically die of the typical stuff everyone else does anyway. Most of the time you're better off self insuring and paying privately IMO.

It's hard to give a clear figure because I've always worked for myself, but I do have some reference points from my social environment. You earn 4k (before taxes) if you work somewhere for several years and have a good job. I think that if you earn 8k every month (before taxes) you are doing very well in the Netherlands. The top 5%. That is, for example, the salary of a judge.

Salaries have not increased much and the imbalance between, for example, the United States and Europe has only increased. Official figures given for inflation are now at 4% but that is wishful thinking. I have seen supermarket prices easily increase by 15-20% in recent years. That is every year.

The reason we have so many expats (and therefore a housing shortage) is because expats are entitled to the 30% ruling (30% of the salary is tax-free). Something that is going to be abolished by the way.

I am not arrogant nor greedy, but I don't understand how people do it. You may have to be a married couple to live a decent life. Living in Amsterdam is not an option if you are not doing very well for yourself. The only option for (younger) people, which they often do, is to live together with roommates. It is a bit like the NYC version of the Low Countries. You only count if you live in Amsterdam.

The average house price is 450k. There is a wealth tax.

Funnily the only thing that pays in this society is earning below average, which entitles you to all kinds of allowances. Once you earn above a certain treshold it's greedy socialism time.

I completely agree with you, I would rather pay tens of percent less in taxes and insure myself privately with a large insurer where I get access to specialized care in private clinics and limited waiting times.

Another bizarre development are stricter regulations on the self-employed. The tax authorities are going to check much more strictly whether you do not act 'too much' like an employee and should therefore actually be employed. Result: lots panic and tens of thousands of deregistrations at the Chamber of Commerce. (Source)

The tax authorities hate, hate it when you are able to deduct costs, they want you to be an employee. Taxes are about to rise as well (Source)

When one is doing business in Western-Europe and it's mostly online, do yourself a favor and leave.

 

[OffshoreDude]

The thing that concerns me more, that they might introducing taxation by citizenship, to keep milking you, no matter whereto you escape. To make it clear, the tax hell Germany has such a concept already in place, see the horrendous AStG.

At least, with that current regulation for "only" the next 10 years after leaving - for now.