German BVI expects pension tax changes
GERMANY - The German investment association (BVI) predict there will be amendments to the occupational pension sector rules, especially when it comes to equal tax opportunities for investment funds, following the change of the government coalition in Germany.
The right-of-centre Free Democrats (FDP) gained 14.6% of the votes in Germany's national election on Sunday, and are now the most likely candidates to form a government coalition with the conservative CDU which got 33.8% of the votes.
The CDU's result was 1.4 percentage points down from the last general election result, but its former coalition partner the Social Democrats SPD suffered a 11.2 percentage point loss achieving only 23%, while the FDP gained 4.8 percentage points.
"We expect the new government to strengthen funded retirement provision and increase competition in the sector," the BVI said in a statement.
The association pointed out insurance-based retirement provision currently had some tax advantages over retirement savings in investment funds.
And judging by the FDP's manifesto, as well as earlier decisions laid out as an opposition party, the BVI's hopes might be legitimate. The FDP's credo is also "strengthening freedom and personal responsibility of the individual".
During its time in opposition - the FDP previously held a government coalition between 1969 and 1998 - the party under Guido Westerwelle was the only non-government party to support a motion to give pensionsfonds more leeway in dealing with underfunding. (See earlier IPE article: Pensionsfonds gain more freedom)
It also recently defended the first pillar funded system for various professions including doctors and lawyers in Germany. (See earlier IPE article: German first pillar funds defended)
The federation of German insurers has also revealed hopes for economic policies which will allow individuals to save for retirement and achieve a balance between the various pillars of the pension system.