Berlin, April 29, 2026 Merz considers higher Reichensteuer in German tax reform
German Chancellor Friedrich Merz has signaled openness to increasing the so-called "Reichensteuer" (wealth tax) as part of a broader income tax reform, potentially raising the rate for top earners while abolishing the Solidaritätszuschlag (solidarity surcharge).
Proposed Tax Changes
The reform would increase the Reichensteuer rate from 45% to 47.5% and lower the income threshold for its application from 277,826 euros to 210,000 euros for single filers. Married couples currently face the tax at twice that amount (555,652 euros), but the proposed changes would adjust their threshold downward as well.
Merz emphasized that such a move would need to be part of a broader restructuring of the tax system. "Das wäre denkbar, wenn, wie in dem Vorschlag der Kollegen vorgesehen, der Steuertarif im oberen Bereich geglättet und etwa der Soli abgeschafft wird," he said, indicating that smoothing out the tax tariff in the upper income bracket and eliminating the solidarity surcharge would be prerequisites.
Political Reactions and Context
The proposal aligns with the SPD’s push for a revenue-neutral reform that shifts the tax burden toward high earners to fund relief for middle- and lower-income households. The Social Democrats have long advocated for higher taxes on the wealthy, framing it as a measure to reduce inequality.