On the government’s tax proposals

Published by Efling on

The government’s proposed tax decreases are far below expectations. However, on further inspection, questions arise about its content and implementation. The finance minister’s slide show was clearly designed to make the proposals look better than they are and some parts of it don’t add up at all. On other issues there are very serious questions.

The personal tax credit, the slides say, would be frozen during the plan’s implementation — from 2020 to 2022. It could, in other words, be stuck for up to four years.

If this turns out to be the case, it would be an assault on the living conditions of low-waged workers. It would hit their wages the hardest and claw back a large part of this planned tax reduction. It was bad enough that the personal tax credit only rose with inflation, not purchasing power, during the last contract period of 2015-2018.

If the personal tax credit, and, with it, the tax-free limit, would remain stuck for such a long time, it would strike directly at those on the lowest wages. Similar questions arise when looking at other parts of the tax and benefits systems. Are all these benchmarks to remain frozen for three to four years?

If that is the case, these proposals aren’t just insufficient, but dangerous and impudent.