The battle against the price avalanche continues to the next round. Cold progress compensation and adjustment of social benefits are the first goals.
Given the record inflation rate of 8 percent in May, work is in full swing on another “anti-inflation” package. It is due to be presented to the National Council on June 14, so that it can enter into force before the summer. The vertices are archived:
- Fix is that the cold progression is balanced. The Ministry of Finance is currently working on a concrete model.
- for sure social advantages there must be an increase. The Wifo proposes child benefit or health care allowance, which has not even been increased with inflation for years.
- The one many have asked for Suspension of carbon prices, which would make fuel and heating even more expensive from July, is a point of contention within the coalition. The Greens reject delay.
“Each percentage point of inflation yields the tax authorities about 300 million euros more”
Cold progress is about the most money: “Each percentage point of inflation yields the tax authorities about 300 million euros more,” explains Wifo boss Gabriel Felbermayr. At an estimated annual inflation rate of 6 percent, that would be about $1.8 billion that taxpayers should get back.
Reference to Germany
Like Germany, Felbermayr proposes “partial automation”. The amount of the extra income from the cold course is determined by experts. But politicians can decide for themselves how they distribute the repayment. Felbermayr: “For example, you can lower the lower tax brackets more, I would welcome that.”
In Germany, equalization takes place every two years, but it could also be done every year, says Felbermayr. He does not want a fully automatic adjustment of the tax levels. “Then there is no room for structural reforms in the tax system.” This year, however, action must be taken quickly as inflation is a major problem, especially for low earners.
“Inflation is the biggest burden for people right now. We have already provided assistance with two aid packages, but are currently working on the next package,” confirms Chancellor Karl Nehammer (ÖVP). The SPÖ reiterated its demand to skim off the “excess profits” in energy prices and wants to use the money to to lower the VAT.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
