Overview

• Finance Minister Lars Klingbeil has proposed higher taxes on top incomes and wealth, specifying single earners with more than €20,000 in monthly income.
• CDU/CSU leaders Friedrich Merz and Markus Söder rejected major tax increases and called for relief for the middle class.
• Official figures show roughly 35,000 million‑euro earners already contribute about €35 billion, so closing the roughly €30 billion 2027 shortfall would require far more than modest rate hikes.
• Finance Ministry estimates indicate a one‑point VAT increase would raise about €16 billion and a move to 22% could cover the gap, though it would raise living costs for households.
• Policy discussion now ranges from limited income‑tax tweaks and a wealth tax worth about €9 billion to the Länder to spending restraint and measures to expand the labor force, with critical commentary intensifying.