TAXES IN GERMANY

Greymouth Evening Star, 18 September 1940, Page 5

TAXES IN GERMANY

A CONSIDERABLE LOAD. Reports are coming through regarding the hardships suffered by German workers due to the British blockade (says an English newspaper). But even before the war there was a shortage of many commodities, especially of butter, fats, eggs, coffee and meat, although the only articles then rationed were butter and fat. The coffee was heavily adulterated, and in consequence of the scarcity of tobacco by law it was made to contain a proportion of herbs. But one of the chief grievances is the heavy taxation which has to be furnished by the wage worker. Unmarried men receiving only moderate wages may have to sacrifice as much as 20 or 25 per cent, to the State under various categories of taxation. The German Income Tax Act, imposed in February, 1938, made provision for a wage tax to be deducted by the employer and paid to the State. For purposes of taxation the term “wages” includes allowances for expenses except travelling expenses that can be vouched for, all pensions (including those of widows and orphans), payment for overtime, or bonuses received for jobs considered specially dangerous or disagreeable. Upon all these receipts is taxation levied. In some cases it works out that in consequence of taxation levied at an extra rate for overtime, the men will receive after deduction of the tax only just above half as much per hour as for the normal time.

The following are the actual examples of the wage tax operating a week or two before the outbreak of war. A single man who received between 118 and 131 reichsmarks a month, being equivalent to £lO/1/7 to £ll/3/9 at the official rate of exchange, would pay 9/4. This means he paid income tax at 2/4 a week out of earnings ranging from 50/- to J56/-. A married man with one child

earning £5/8/- per week, would be taxed 4/8. If a worker receives a special bonus in addition to his wage the tax on the bonus would, for a single man, be 18 per cent., for a married man with children anything from 1 to 8 per cent., according to the number of his children. This is in addition to the taxes mentioned on the net wage; It must be a relief for the German to know that. presents from the firm to celebrate a long period of service are not taxed, nor are wedding presents to females when leaving their employment, unless the recipient is a Jewess. MANY DEDUCTIONS. There are a number of other direct taxes besides that on wages the German worker must pay, among these being unemployment insurance, health insurance, superannuation insurance, workers’ insurance, and a contribution to the German Labour Front. An unmarried worker receiving 50/- to 56/- a week has to pay 2/4 a week for wages tax, about 1/9 for unemployment insurance, about 1/6 for health, about 1/- for the Labour Front, about 1/10 for workers’ insurance and 7d for superannuation — a total of nearly 9/- out of about 53/-. Thp married man with onechild, earning £5/8/- a week, pays a total of 16/8 for the above-men-tioned items. These deductions are from four to eight times as much as those paid by British workers, who also receive a higher average rate of pay.

On the top of the foregoing is the citizen tax which municipalities are authorised to raise. This applies to Germans over the age of 18. This, fortunately, is only a few shillings per annum. , In addition, of course, are the indirect taxes levied upon beer, tobacco, sugar, fats, and other categories, and direct taxes under the headings of transport, freightage, turnover, wealth, corporations’.profits, and the income taxes of assessed

persons. The taxation of Germans increased between 1937-38 and 1938-39 26.7 per cent., the increases chiefly affecting the workers being 18.9 per cent, in the wages tax, 9.9 per cent, in tobacco, 16 per cent, in beer, and 5.1 per cent, in the tax on sugar. Property taxes, transfer duties and income taxes increased even more, in one year jumping 32-42-per cent. Altogether, then, the people of Germany, even before the war, paid heavily for the dubious privilege of National Socialism. Since the. waitheir hardships have multiplied, and will continue to do so until they de-? cide that guns are more expensive than butter; and far less edible. The German Minister of Finance has recently proposed a new form of taxation amounting to 25 per cent, of the value of all articles not rationed and regarded as luxuries. Each person’s essential requirements are to be calculated so that any extra expenditure, such as the cost of holidays, or even of an operation, will require aspecial permit from the Ministry.