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The Bundesriegerung plans to increase the income threshold for social security, as originally reported by the „Süddeutsche Zeitung“ and the „Bild“. The decision will be made in October, and is expected to come into effect on the 1st January 2013.

„If the borders do not grow with income, the expense would be gradually shifted to those with lower income“ (quote translated by Kon.Media) explained a Bundesriegerung official, regarding the annual adjustment. Accordingly, high earners are now especially burdened in the future.

In pensions and unemployment insurance, the annual income threshold is EUR 69,900 (East: EUR 58,800), and in health and long-term care insurance, it is at EUR 45,900. On the other hand, the contribution to pensions insurance will fall considerably, from 19.6% to 19%.

This will also make the change from public insurance to private insurance more difficult. The draft regulations propose a compulsory insurance threshold above which a change is possible, raising it from EUR 50,850 to EUR 52,200 for the coming year. The contribution increases are to be decided by the Cabinet in October.

Commentary: To increase this limit leads to more revenue for social security, which would increase the scope for reductions in contribution rates. Regarding the increase in contribution rates to public health insurance, public opinion differs. The coalition earlier this year increased the rates from 14.9% to 15.5%.

Bundesgesundheitsminister Daniel Bahr has dismissed any chance of a reduction, despite the strong financial position of public sickness funds currently. Because of future rising expenses and the likely worsening of the economic situation in Germany, there was no scope for a reduction in contributions. In the case of the preferred dividend payment, the money would then flow only to the insured, and employers would benefit only in case of a statutory reduction in contributions.