BERLIN (Reuters) – According to a study, people on low incomes have particularly benefited from state aid in response to high inflation.
The federal government has launched 28 measures to relieve the burden on citizens in the crisis, as the employer-oriented Institute of the German Economy (IW Köln) announced on Monday. These include the price brakes for electricity and gas, the 9-euro ticket and the tank discount. The bottom line is that the packages added up to around 240 billion euros. In addition, for many there is an employer-financed, tax-free inflation adjustment premium of up to 3,000 euros. “Politicians have managed to cushion a large part of the burden,” was the conclusion of the study. “Especially people with low incomes have benefited from the state relief.”
According to the calculations, a family of four with a gross annual salary of 40,000 euros will have to pay 5,388 euros more this year and last year due to price increases. Relative to net income, the burden is 7.6 percent in 2022 and 6.8 percent in the current year. The state relieved here with 8543 euros, which means a plus of 3155 euros. The main reason for this is the increase in housing benefit and child allowance, which particularly supports low-income families.
Accordingly, childless normal earners receive less state aid. A single person with an income of 45,000 euros paid a total of 3360 euros due to the price increases. The burdens are therefore relative to net income at 6.2 percent in the previous year and at 5.4 percent in the current year. The state gave 808 euros in relief, leaving a gap of 2552 euros. If the single receives the full tax-free one-time payment from the employer, this results in a plus of 448 euros. According to IW, the biggest gap is with high earners: for singles with an income of 75,000 euros, a gap of 2861 euros remains even after the state relief – provided there is no inflation compensation premium. For families with an annual income of EUR 120,000, there is a gap of around EUR 6,000.
“Those who only have a small income were hit hard by the price increase,” said IW tax expert Martin Beznoska. “The state has provided extensive relief here, above all through the housing benefit.” However, not all measures are accurate: In some cases, those who did not need help, such as a single person with an annual income of 75,000 euros, also benefited. “More sense of proportion would make sense here in the future,” said Beznoska. “After all, it’s the taxpayers who pay for the high expenses.”
(Report by Rene Wagner, edited by Ralf Banser – If you have any questions, please contact our editorial team at [email protected])