(NoteGPT)
(de-news.net) – Senior figures within the Christian Democratic Union (CDU) have continued to resist the Social Democratic Party’s (SPD) proposals for reforming the inheritance tax, reinforcing opposition inside the Union parliamentary group and framing the initiative as both unnecessary and politically marginal. Union budget spokesman Sebastian Güntzler has reiterated the position that the federal government regards the existing inheritance tax framework as compliant with constitutional standards. From this standpoint, he has argued that there is no compelling legal or structural imperative for reform, maintaining that the SPD’s proposals represent a departure from what he characterizes as a stable and constitutionally secure status quo. Within this line of reasoning, the initiative is portrayed as lacking broad societal endorsement as well as immediate legal urgency. Comparable skepticism has been articulated by Christian von Stetten, chair of the Bundestag’s Parliamentary Circle on Small and Medium-Sized Enterprises, who has likewise depicted the SPD’s push as politically ineffective and unlikely to gain traction.
SPD’s reform vision and economic rationale
By contrast, the concept unveiled earlier in the week by the SPD parliamentary group envisages a far-reaching reconfiguration of inheritance taxation, combining a progressive rate structure with multimillion-euro tax-free allowances for both private heirs and business assets. Within the SPD, the proposal is framed not as a blanket tax increase but as a targeted adjustment intended to correct perceived imbalances in the current system. The party’s deputy parliamentary leader, Wiebke Esdar, has sought to dispel warnings of adverse economic effects, arguing that the design would shield family-owned enterprises and associated employment by exempting the overwhelming majority of businesses from any inheritance tax liability. Under this interpretation, criticism of the reform is presented as primarily defending the interests of very large fortunes rather than those of the Mittelstand, which the SPD claims would remain largely unaffected.
Chancellor Merz voices caution amid SPD assurances
Reservations have nonetheless been voiced at the highest level of government. Chancellor Friedrich Merz has cautioned that the proposals could unsettle businesses and complicate the intergenerational transfer of family-owned firms. Responding to these concerns, Esdar has emphasized that small craft and local enterprises would face no tax burden under the SPD model, while the liabilities imposed on large corporations would remain proportionate and, in many cases, comparatively modest. She has further underscored that the reform is conceived as a gradual adjustment through a progressive tariff broadly aligned with existing family-related tax brackets. This approach, she argues, is intended to address a structural imbalance in which very large estates can currently be transferred with minimal taxation, while ordinary heirs may bear relatively heavier burdens.
The sharpness of the Union’s reaction has drawn criticism from SPD parliamentary leader Matthias Miersch, who has called for a calmer and more substantive debate. He has reiterated that approximately 85 percent of German businesses would be exempt under the SPD proposal and that any tax obligations arising for the remainder could be spread over a period of up to 20 years. This installment-based approach, he has argued, is designed to prevent sudden liquidity pressures and to ensure that inheritance taxation does not jeopardize business continuity.
Radtke asking CDU to reconsider
Notably, dissenting voices have also emerged from within the Union itself. Dennis Radtke, chair of the Christian Democratic Employees’ Association, has urged his party to reassess its position, pointing to what he describes as billions of euros in annual revenue losses resulting from inheritance-related loopholes. While affirming the need to protect small and medium-sized enterprises from measures that could erode their productive substance, Radtke has drawn a clear distinction between such firms and the transfer of billion-euro fortunes facilitated by a needs-based exemption he regards as problematic. In his assessment, conflating these fundamentally different cases under the label of the Mittelstand distorts the debate and weakens the credibility of arguments centered on fairness and equity.
Left Party critiques SPD and coalition’s track record
From the opposition benches, Left Party co-leader Heidi Reichinnek has questioned the credibility of the SPD initiative, noting that the party has participated continuously in government for more than a decade, a period during which vast sums were inherited without taxation. She has criticized the governing coalition, and particularly the Union, for resisting even limited measures to close loopholes benefiting the ultra-wealthy. In her view, rhetorical commitments to fairness must be matched by concrete legislative action. Reichinnek has further argued that mechanisms allowing multimillionaires to substantially reduce their taxable wealth exacerbate social inequality and undermine social cohesion.
Hüther warns SPD tax plan could burden family firms
Economic reservations have also been expressed by Michael Hüther, head of the German Economic Institute. While acknowledging the potential advantages of simplifying inheritance tax rules, he has warned that the SPD’s proposed five-million-euro allowance for business heirs could impose considerable additional burdens on mid-sized family firms. Such effects, he cautions, could incentivize corporate relocation and threaten employment. Beyond the inheritance tax debate, Hüther has called for greater ambition in broader tax policy, including earlier reductions in corporate tax rates, the abolition of the solidarity surcharge, and more comprehensive electricity tax relief. At the same time, he has offered a cautiously optimistic outlook on the broader economy, forecasting modest growth and suggesting that, despite persistent challenges, the German economy is showing early signs of recovery rather than facing imminent decline.
