Federal Finance Minister Christian Lindner (FDP) is introducing tax breaks worth billions. Now there are official figures. The basic salary and income tax allowance is due to take effect from January 2025 increase by €300 to €12,084.
Lindner also announced that the basic tax allowance will increase by 180 euros this year and will amount to 11,784 euros, retroactively until January 1. There is no tax up to this income. In 2026, an increase of 252 euros to 12,336 euros is planned.
Take advantage of it especially to all taxpayers and workers, who still do not pay taxes. It should remain so, increasing the basic allowance. Basically, basic benefit is designed to ensure that people can afford certain things in life. This includes at least food, clothing, housing and emergency medical care.
By the way, the double basic benefit applies to married couples. This will be €24,168 from 1 January 2025, €24,168 from 2026 and €24,672 from 2026.
The Child Tax Benefit will be increased by €60 to €6,672 for the 2025 assessment period and by €156 to €6,828 from the 2026 assessment period.
But! The figures for basic benefit and child tax benefit can still be changed in the autumn after the so-called progress report is presented.
Here’s how many singles will have in their pockets from 2025
“People want to see results and not just press conferences,” said Rainer Holznagel, president of the German Taxpayers’ Association.
The calculation refers to the adjusted basic allowance. When calculating, the Association of Taxpayers assumed that the taxable income (zvE) also includes the additional payment of the statutory health insurance.
This is how much a family of four will have from 2025
For this calculation, the taxpayers’ association assumed a married couple with two children. Only one spouse is fully employed.
The solidarity fee will be reduced
To compensate for the additional tax burden caused by high inflation, the tax burden of millions of people must be adjusted. To this end, the federal government is adjusting income tax rates for 2025, as well as basic benefit, child benefit and Soli benefit.
The term “cold progression” describes a type of creeping tax increase where, for example, wage increases are completely consumed by current inflation but still result in higher taxation.
The combination of tax classes III and V is no longer applicable
The different tax classes (III and V) for married couples will be abolished. Instead, there should be only one tax bracket for both spouses. So far, high income earners are taxed under Class III tax, low income earners are taxed under Class V tax. While high earners pay less in taxes and therefore have more in their accounts, the opposite is true for low earners. After filing the tax return, refunds are usually issued by the tax authorities, depending on the amount of taxable income.
By eliminating tax brackets III and V, low-income earners pay less tax and higher-income earners pay more. The main thing is that there should be no additional burden for the couple. However, calculations show. In some cases Then there will be additional burden. And the state benefits from this.