Overview
- The SPD concept sets a lifetime €1 million personal allowance, a €5 million exemption for business inheritances, progressive taxation above those thresholds, abolition of current privileging rules, and payment options stretching up to 20 years.
- SPD deputy Wiebke Esdar says most heirs would pay less and most family firms would remain tax-free under the €5 million threshold, citing KfW data showing a typical medium‑sized firm valuation near €500,000.
- Chancellor Friedrich Merz and the Union reject the proposal, warning it could complicate successions, and business groups including DIHK and The Family Entrepreneurs argue the €5 million exemption is too low for many Mittelstand companies.
- Economic institutes and tax experts call for clarity on tariff rates, asset valuation, anti‑abuse rules and the precise conditions for long deferrals, noting the pending constitutional review of current business‑inheritance privileges.
- DIW president Marcel Fratzscher backs the need for reform as overdue and proposes a long‑term flat tax for company heirs to avoid taxing substance and protect investment and jobs.