The leader of Germany’s Social Democrat party (SPD) has backed proposals to adjust the personal income tax brackets in an effort to undo stealth taxation that has resulted from the effects of inflation. This is considered to have unfairly hit middle-income earners. The SPD put forward the idea in the run up to the September 2013 elections and proposed financing the measure through a hike in the top rate of income tax. The SPD is now in a coalition Government with the Christian Democratic Union (CDU), but will still only agree to tax relief for middle-income earners provided that the country’s top earners face higher taxes.
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