Pension tax bill moves

Pensioners who have so far enjoyed tax privileges will gradually pay more from next year until 2040, a top German finance official said at the ABA meeting.In return, yearly contribution to pensions would become gradually tax free, the official said.
Under the new pension taxation billrecently passed by the Bundestag, the fragmented second-pillar tax regime would be also be consolidated.
“I know that there are many arguments in favour and many against it,” state secretary for the finance ministry, Volker Halsch, told the annual meeting of ABA, the German association of company pension schemes in Bonn.
Halsch explained that demographic and financial changes in the country made changes necessary.
The new bill has already split public opinion. Unions have showed mixed feelings and the opposition has criticised it as complicated and inconclusive.

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