6 ms·

Are there state level and municipal level income taxes as well?

lxgr 4y ago
No.
brazzy 4y ago
Nope. The income taxes are distributed in a fixed ratio, 15% goes to the municipality/county, and 42.5% each to the state and the federal budget.
Aachen 4y ago
There is - TV tax (also if you don't own a TV), - pension tax (also if you have ETFs of your own), - care and health insurance are two things separately deducted before money makes it into your bank account, - iirc until 2021 eastern germany taxes to help poorer regions, - church taxes if your parents signed you up for it -- until you pay a fee to get unregistered from the church. This is all separate from income tax. And of course if you own a car or want to use public transport that's separate still. Not sure what my landlord pays for waste management, in NL I think you pay separately for that, can't quickly find it for Germany (German Wikipedia about Kommunalabgaben says Abwassergebühren are indeed a municipality or city circle thing, but then two others said you don't pay anything to the municipality so I'm not confident I'm reading this German article correctly).
- valenterry 4y ago
  Let's clarify a bit here. - There is no "TV tax". There is a fee that most households (not people) must pay. It's always the same, no matter what your personal marginal tax rate is. - pension premiums are not a tax. For employees they get deducted from your gross income and effectively lower your tax - and gains from ETF are not considered. - For care and health insurance it's the same as for pension. - Yes, there's still a tax for western Germany to help eastern Germany - Yes, there's church tax (if you are already e.g. catholic) and yes you have to be a fee to get out of it. In addition, for employees (and some others) there are: - Mandatory unemployment premiums - Additional premiums for care insurance if you are single - Mandatory accident insurance (paid by the employer though)
  - WanderPanda 4y ago
    Doesn't matter what terms you slam on it, in the end very few coins enter your pocket / stay there (I'm looking at you, vat) in Germany even if you just have a mediocre income.
    - valenterry 4y ago
      It doesn't matter for what ends up in your pocket from your paycheck in the end. But it still matters quite a bit. If you just see "deductions: 42%" on your paycheck, that's different from seeing "3% tax because you don't have children, 4% tax because you live in west Germany, ...". It helps you understand your life situation's impact on what ends up in your pocket and it also educates people in some way, e.g. there will be more public discussions if it's still necessary for western Germany to support eastern Germany if the impact is immediately visible on your paycheck. In addition, since pension is not a tax, it matters both in the sense that higher pension contributions lower the tax you pay _and_ it also matters in that you earn claims against the state for receiving pension later on. Pension contributions are protected very differently by German law compared to if it were just a tax and you would gain welfare from the state when you stop working. This might be a nitty gritty detail, but it starts to matter when people want to change pension distributions - e.g. some changes suddenly might require 2/3 of the parliaments votes instead of a simple majority vote. I could go on, but I think that's enough food for the mind.
  - Aachen 4y ago
    I'm not opposed to them btw, but as a Dutch person I found it weird to have this all split out. In NL you get AOW no matter if you're the queen or just Joe, you just have to be of pensionable age and iirc lived in NL during your working life. The public broadcasts are financed with tax money but not every household separately gets a bill equivalent to a Netflix subscription to be paid for a year ahead. If we pay money to zimbabwe then that's just regular tax money also, not another separate solidarity tax entry on your payslip.
    - valenterry 4y ago
      > I'm not opposed to them btw, but as a Dutch person I found it weird to have this all split out. No problem, I'm just trying to shed some light into it for those not German and/or not familiar with how it works in Germany. Also, these things are difficult and there are many pros and cons, so I'm not even sure what my own opinion is on many of those things. But I can at least provide some pros & cons and then everyone can make up their own mind about it. > In NL you get AOW no matter if you're the queen or just Joe, you just have to be of pensionable age and iirc lived in NL during your working life. In Germany it's different because the amount of your pension depends on your contributions - hence it makes sense for it to be different from tax that you pay (which have no impact on your pensions at all). At the same time it has benefits if things are listed out separately, because it increases transparency to where your money goes. At the same time it increases beaurocracy (and hence costs for administration) quite a bit, in particular for foreigners. > The public broadcasts are financed with tax money but not every household separately gets a bill equivalent to a Netflix subscription to be paid for a year ahead. The reason why this is a fee in Germany and not a tax lies in the idea that the public media should be more independent from the politics. Whether this really works or not is a different question, but it was set up like this so that politicians can't "threaten" journalists and public media by reducing their budgets if they don't do as politicians want. At the same time. The process for deciding on the amount of the fee is a bit complicated and involves politicians as well, but not only. It definitely adds friction that it's a separate system. For instance, exceptions are being made for certain groups e.g. people who live on social welfare, who are students without income and sufficient financial support from their parents, people who have heavily impaired vision/hearing and so on.

lxgr 4y ago

No.

Nope. The income taxes are distributed in a fixed ratio, 15% goes to the municipality/county, and 42.5% each to the state and the federal budget.

Aachen 4y ago

There is - TV tax (also if you don't own a TV), - pension tax (also if you have ETFs of your own), - care and health insurance are two things separately deducted before money makes it into your bank account, - iirc until 2021 eastern germany taxes to help poorer regions, - church taxes if your parents signed you up for it -- until you pay a fee to get unregistered from the church. This is all separate from income tax. And of course if you own a car or want to use public transport that's separate still. Not sure what my landlord pays for waste management, in NL I think you pay separately for that, can't quickly find it for Germany (German Wikipedia about Kommunalabgaben says Abwassergebühren are indeed a municipality or city circle thing, but then two others said you don't pay anything to the municipality so I'm not confident I'm reading this German article correctly).

valenterry 4y ago
Let's clarify a bit here. - There is no "TV tax". There is a fee that most households (not people) must pay. It's always the same, no matter what your personal marginal tax rate is. - pension premiums are not a tax. For employees they get deducted from your gross income and effectively lower your tax - and gains from ETF are not considered. - For care and health insurance it's the same as for pension. - Yes, there's still a tax for western Germany to help eastern Germany - Yes, there's church tax (if you are already e.g. catholic) and yes you have to be a fee to get out of it. In addition, for employees (and some others) there are: - Mandatory unemployment premiums - Additional premiums for care insurance if you are single - Mandatory accident insurance (paid by the employer though)
- WanderPanda 4y ago
  Doesn't matter what terms you slam on it, in the end very few coins enter your pocket / stay there (I'm looking at you, vat) in Germany even if you just have a mediocre income.
  - valenterry 4y ago
    It doesn't matter for what ends up in your pocket from your paycheck in the end. But it still matters quite a bit. If you just see "deductions: 42%" on your paycheck, that's different from seeing "3% tax because you don't have children, 4% tax because you live in west Germany, ...". It helps you understand your life situation's impact on what ends up in your pocket and it also educates people in some way, e.g. there will be more public discussions if it's still necessary for western Germany to support eastern Germany if the impact is immediately visible on your paycheck. In addition, since pension is not a tax, it matters both in the sense that higher pension contributions lower the tax you pay _and_ it also matters in that you earn claims against the state for receiving pension later on. Pension contributions are protected very differently by German law compared to if it were just a tax and you would gain welfare from the state when you stop working. This might be a nitty gritty detail, but it starts to matter when people want to change pension distributions - e.g. some changes suddenly might require 2/3 of the parliaments votes instead of a simple majority vote. I could go on, but I think that's enough food for the mind.
- Aachen 4y ago
  I'm not opposed to them btw, but as a Dutch person I found it weird to have this all split out. In NL you get AOW no matter if you're the queen or just Joe, you just have to be of pensionable age and iirc lived in NL during your working life. The public broadcasts are financed with tax money but not every household separately gets a bill equivalent to a Netflix subscription to be paid for a year ahead. If we pay money to zimbabwe then that's just regular tax money also, not another separate solidarity tax entry on your payslip.
  - valenterry 4y ago
    > I'm not opposed to them btw, but as a Dutch person I found it weird to have this all split out. No problem, I'm just trying to shed some light into it for those not German and/or not familiar with how it works in Germany. Also, these things are difficult and there are many pros and cons, so I'm not even sure what my own opinion is on many of those things. But I can at least provide some pros & cons and then everyone can make up their own mind about it. > In NL you get AOW no matter if you're the queen or just Joe, you just have to be of pensionable age and iirc lived in NL during your working life. In Germany it's different because the amount of your pension depends on your contributions - hence it makes sense for it to be different from tax that you pay (which have no impact on your pensions at all). At the same time it has benefits if things are listed out separately, because it increases transparency to where your money goes. At the same time it increases beaurocracy (and hence costs for administration) quite a bit, in particular for foreigners. > The public broadcasts are financed with tax money but not every household separately gets a bill equivalent to a Netflix subscription to be paid for a year ahead. The reason why this is a fee in Germany and not a tax lies in the idea that the public media should be more independent from the politics. Whether this really works or not is a different question, but it was set up like this so that politicians can't "threaten" journalists and public media by reducing their budgets if they don't do as politicians want. At the same time. The process for deciding on the amount of the fee is a bit complicated and involves politicians as well, but not only. It definitely adds friction that it's a separate system. For instance, exceptions are being made for certain groups e.g. people who live on social welfare, who are students without income and sufficient financial support from their parents, people who have heavily impaired vision/hearing and so on.