As the German government scrambles to rein in the ballooning deficit,Finance Minister Wolfgang Schäuble has reportedly proposed a hike in so-called 'solidarity' surcharge - the unpopular reunification tax.
In one of the more surprising ideas being thrown about, Schäuble stunned his senior colleagues by suggesting raising the Soli surcharge from the present 5.5 percent of a worker’s income tax to 8 percent, the Financial Times Deutschlandreported Thursday.
The solidarity surcharge was set up nearly 20 years ago to pay for the revival of the moribund former communist eastern states. In recent years there have been growing calls to scrap it altogether.
