As of: January 23, 2024, 11:38 a.m
By: Lisa Mayerhofer
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Shortly after the budget agreement, the next dispute flared up between the traffic light parties.
Finance Minister Lindner wants to increase the child allowance, but not child benefit.
An overview.
Berlin – There is once again a thick atmosphere between the traffic light parties: Federal Finance Minister Christian Lindner (FDP) plans to increase the tax allowance for children, but not the child benefit.
The SPD and the Greens reject this.
Their accusation: Only rich families would benefit from it.
But what is behind it and what does it mean for families?
An overview.
What is the difference between child benefit and child allowance?
Parents automatically receive either child benefit or the income tax allowance for children.
The tax office checks what is more advantageous for you.
The allowance is often only worthwhile if the parents have a very high income.
In addition, unlike child benefit, the allowance is not paid out, but is a type of tax relief.
How much should the child tax allowance be increased according to Lindner?
The tax allowance was already increased from 6,024 euros to 6,384 on January 1st and, according to the Finance Ministry's plans, should increase retroactively to 6,612 euros, as a ministry spokesman confirmed on Friday.
For comparison: Child benefit was generously increased in 2023 and rose to a uniform amount of 250 euros per month per child.
According to Lindner, the child tax allowance was increased relatively little last year - so now it should be followed suit.
Federal Finance Minister Christian Lindner (FDP) plans to increase the tax allowance for children, but not the child benefit.
(Archive image) © Bernd Weißbrod/dpa
Debate about the child allowance: What positions do the traffic light parties represent?
SPD party leader Lars Klingbeil had previously
criticized Lindner's plans in
Bild am Sonntag as "unfair" because they would only provide relief for families with very high incomes.
The SPD's financial policy spokesman, Michael Schrodi, told
BamS
about Lindner's plans: “The SPD will not go along with that.
There will be no majority for such plans from Lindner.”
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There are also objections from the ranks of the Greens.
“Families in the middle must not go away empty-handed,” said parliamentary group vice-president Andreas Audretsch to the newspaper.
It is common practice to increase child benefit and child allowance equally.
“Citizens rightly expect this reliability.”
The FDP defends Lindner's plan and launches a counterattack: "It was decided in 2022, at the suggestion of Olaf Scholz, to increase child benefit disproportionately to 250 euros," the German Press Agency learned from the FDP executive committee.
“The child tax allowance, on the other hand, should be added in the usual procedure.
Nothing else is planned.”
Child benefit and child allowance: Are there other ideas?
SPD parliamentary group leader Rolf Mützenich has brought up a completely new child benefit in the dispute with the FDP.
“So that further debates about the unequal benefits for children no longer arise in the future, we should replace the child allowance with a new child benefit,” Mützenich told the
Rheinische Post
on Tuesday.
However, the parliamentary group leader did not make any concrete suggestions for this new child benefit.
What's next?
Government spokesman Steffen Hebestreit announced on Monday that there would be “internal government discussions” on the topic in the “coming weeks”.
It is being examined what effects, among other things, wage developments and inflation would have on the child allowance.
“Then you have to clarify whether further adjustments are necessary,” said Hebestreit.
If this is necessary, it must be discussed whether an adjustment to child benefit is necessary in addition to the allowance.
In addition, the child tax allowance and child benefit mechanism will be linked to the basic child benefit, which should apply from 2025.
“In this respect, this discussion will hopefully be settled.” The planned basic child security is intended to bundle previous benefits such as child benefit, benefits from citizens’ benefit for children or the child allowance.
With material from dpa and AFP