On February 22, 2006, the German cabinet adopted the draft federal budget for 2006. It also decided to increase social contributions on "minijobs" that are paid 400 euros per month, or less. The flat contribution rate should thus increase to 30%. It is currently 25%. (Ref. 06170)
According to a governmental spokesman, this increase should raise the income of the sickness and retirement Offices. It would thus allow to lower federal subsidies to these Offices, which would lower the federal budget. This provision is part of a draft law, “Haushaltbegleitgesetz”, which accompanies the draft 2006 budget. This budget notably contains a raise of the sales tax, from 16% to 19% in 2007. These two texts will be read in first reading from March 28th to 31st in the Bundestag,...
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