The Free Press, Mankato, MN

Talkers

October 28, 2012

Cash-strapped Europe nations are not shy about taxing the rich

(Continued)

UCCLE, Belgium —

Critics say a tax designed to “soak the rich” is a surefire way to damp investment, stifle innovation and destroy jobs. Supporters call it basic fairness, arguing for greater responsibility from the highest earners at a time when inequality across Europe is becoming worse.

“Very few people are getting more money and very many people (are) getting less,” says Jutta Sundermann, a social activist in western Germany. “The money we want to take through these levies will not mean that any of the richest will become poor. They will still have more than most people.”

Sundermann is a spokeswoman for Umfairteilen, an umbrella organization of unions, environmental groups and other lobbies that sent tens of thousands of people onto the streets of German cities last month in favor of higher taxes for the rich.

They’ve been galvanized by two things. Even in economic powerhouse Germany, which has yet to feel the same sting of recession and mass unemployment as other European countries, authorities are struggling to fund public services such as transport, libraries and swimming pools.

At the same time, a respected think tank issued a report in July asserting that a one-off tax of 10 percent on Germany’s richest 8 percent could add $300 billion to government coffers.

The country’s biggest opposition party, the Social Democrats, has written a wealth tax into its platform, a 1 percent levy on residents with assets of more than $2.6 million, which would generate about $11.5 billion a year.

Umfairteilen, whose name plays on the German word for “redistribution,” advocates a one-time tax and an annual levy. But there’s little indication that the conservative government of Chancellor Angela Merkel is on board.

“You still have a lot of people in Germany believing what Angela Merkel and the liberals say, that there will be more wealth and happiness if you have the rich and do not ask them to give more,” Sundermann says. “But there is some change.”

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