Germany's spousal tax reform sparks fierce debate over labor equality
German Finance Minister Lars Klingbeil has announced plans to abolish the country's joint spousal tax assessment system. Known as Ehegattensplitting, the current model has faced criticism for discouraging secondary earners—often women—from working more hours. The proposed reform aims to push more married couples into the workforce or increase their working time. The debate over scrapping Ehegattensplitting has deepened divisions within the conservative CDU/CSU alliance. CDU Family Minister Karin Prien backs reform, arguing it could modernise the tax system. But CSU leaders, including Klaus Holetschek and Markus Söder, have dismissed the idea as a tax increase on families.
The SPD first called for changes to the system during the 2021 federal election campaign. Now, with Klingbeil leading the push, the government's focus is clear: reforming the tax model to boost labour supply and economic growth. Supporters claim the current system discourages second earners—typically spouses with lower incomes—from taking on extra work.
Opposition remains strong among conservative factions. Many CDU/CSU members argue that abolishing the split assessment would penalise traditional family structures. The dispute highlights a broader clash over tax policy and its impact on households. If approved, the reform would mark a major shift in Germany's tax policy. The government expects it to encourage more married couples to enter the job market or extend their working hours. The outcome will depend on whether Klingbeil can overcome resistance from within the CDU/CSU and other critics.
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