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Spouse splitting: Ifo president calls for reform

2021-09-16T09:11:51.176Z

The greater the difference in wages, the more advantages: spouse splitting favors a traditional distribution of roles. Ifo President Clemens Fuest is now in favor of reform.



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He earns the money, she brings up the children: couples with traditional roles benefit from spouse splitting.

Photo: Friso Gentsch / dpa

Because it creates false incentives, Ifo President Clemens Fuest speaks out in favor of reforming the controversial spouse splitting.

"From an economic point of view, the spouse splitting creates strong incentives for second earners, usually women, not to be gainfully employed or at most to take a part-time job - and instead concentrate on household chores and child-rearing," said the head of the Munich economic research institute.

Another model, such as the so-called »real splitting«, fits better with modern life models.

Spouse splitting brings tax advantages above all to couples whose salaries differ greatly - as a rule, this benefits couples where the man earns a lot and the woman less or nothing.

The image of the family today is more diverse than the traditional division of labor with the man as the sole breadwinner, says Fuest.

"Equal rights for women, a fundamental social concern, has a lot to do with employment and economic independence." However, tax policy can only be one of several measures to offer women incentives to work.

Improved childcare and a better work-life balance are also important.

Parties argue about reform

Real splitting, which Fuest mentions as an alternative, principally tax the spouses independently of one another. Nevertheless, the higher earner can transfer a certain amount to the other person for tax purposes. That makes sense because the spouses are mutually obliged to support each other, said Fuest. In contrast to spouse splitting, however, the work incentives are not so limited in real splitting. According to estimates, the introduction of real splitting could benefit 50,000 full-time positions.

Spouse splitting, introduced in 1958, is highly controversial in Germany.

Because it consolidates traditional role models and particularly favors couples with high incomes, be it socially unjust and stand in the way of gender equality, say the Greens, for example.

The SPD and the Left are also speaking out against spouse splitting in its current form, the Union would like to adhere to it.

jlk / dpa

Source: spiegel

All business articles on 2021-09-16

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