As general secretary of his party, Bijan Djir-Sarai can be deployed in all positions. On Friday morning we had to switch from defense to attack – and back. Unresolved questions are piling up more and more in the traffic light coalition. Fast switching and a flexible playground are required. The FDP man therefore offensively rejected the suggestion to introduce an excess profit tax in the ARD morning magazine.
This burden of higher corporate profits in troubled times – a crisis profiteer tax – displeases the Free Democrats. But many of the SPD and Greens like it. Djir-Sarai therefore warned that such a levy would “massively damage” the business location. Investments would be canceled, jobs would be endangered.
Finance Minister Christian Lindner had previously revealed in a lengthy statement on Twitter that the FDP is actually in acute defensive mode. The FDP boss fears “that this measure will do us all more harm than good”. The excess profit tax is “arbitrary and ruins confidence in our tax system”. Apart from the fact that there are no oil companies (the preferred target of tax advocates) based in Germany. Which is true on the one hand, the giants of the industry are based in the USA, Great Britain, France and Italy. On the other hand, they have subsidiaries here, and they also make profits.
Shortly before Djir-Sarai, Saskia Esken was also on the morning show. The SPD boss is the opposite pole in the debate, together with the Greens, who brought up the idea of skimming off high profits in the crisis months ago. For Esken, the excess profit tax is an issue of justice. It’s about companies that make excessive profits without their own performance and innovation, “i.e. profit from the crisis,” she said. The state should use this to relieve the burden on citizens and small businesses.
Esken won’t give up. The fact that a government spokesman said at the beginning of the week that “from the Chancellor’s point of view there is currently no provision for an excess profit tax” seems to have lost much of its weight within a few days.
Lindner and Esken are also at odds on another topic. It is about adjusting the income tax rate to inflation, also known under the motto “reduction of the cold progression”. This, in turn, is a question of justice for the FDP. She wants to take the loss of purchasing power caused by price increases into account as much as possible when assessing taxes. It’s the big relief project for the “hard-working middle,” as Djir-Sarai puts it. According to information from the Tagesspiegel, Lindner wants to make suggestions as early as next week, in the form of key points.
Esken recently countered that low earners would hardly be reached because they paid little or no income tax. It is true that workers with middle incomes would be relieved. “But the highest earners who do not need our support benefit the most,” she told the German Press Agency. However, since inflation compensation is provided for by law, the coalition cannot avoid it. The amount could of course still be disputed.
Lindner is therefore likely to include a fairness component in his proposals, for example by ensuring that particularly high incomes benefit less or not at all from the inflation adjustment. It is unclear what role the excess profit tax will play in the larger relief package that the traffic light wants to launch in the fall. After all, it would also have an advantage from the point of view of the finance minister: it would bring in income that would at least somewhat reduce the minus due to inflation compensation in income tax.
In view of the accumulation of points of contention – in addition to tax issues, these are about the gas levy, citizen income, third relief package, continuation of the nine-euro ticket – there are some indications that a meeting of the coalition committee is approaching. The last was at the end of June – the leaders of the SPD, Greens and FDP went into the summer break without any agreements. This was then filled with a variety of demands and announcements from all sides.