Record tax revenue: Schmalkalden benefits from billions in payroll taxes!

Record tax revenue: Schmalkalden benefits from billions in payroll taxes!

In recent years, the wage and income tax (LEK) has taken a central place in the financial architecture of German cities. The high income from this type of tax is particularly popular in municipalities such as Schmalkalden, Steinbach-Hallenberg and Brotterode-Trusetal. According to an article by insuedthueringen.de Particularly well-paid employees, such as professional athletes, are responsible for this development. They ensure that local authorities as well as the federal and state governments benefit from the tax revenue.

But why is this income so important? Wage and income tax is one of the most profitable tax types in Germany. In 2021, around 291 billion euros were raised bpb.de reports. This is also reflected in the distribution of tax revenue, where wage and assessed income tax is the top priority.

Importance of wage and income tax

This type of tax not only provides financing for public spending, it also enables important analyzes and calculations on the impact of changes in tax law. According to the Statistics from the Federal Statistical Office Payroll tax statistics collect a lot of data. These include declared payroll tax amounts, amounts deducted and the number of employees, which is essential for the further development of the tax system.

The results of the wage and income tax statistics are incorporated into numerous reports, including the poverty and wealth report and the report on the situation of the freelance professions. This shows how closely tax systems are linked to the social situation in Germany. One example is the increasing tax burden on pensions, which is constantly increasing due to downstream taxation.

A look at the numbers

A closer look at tax revenue reveals the importance of the wage tax for public budgets. In 2021, wage tax accounted for 218 billion euros and assessed income tax accounted for 72 billion euros. Overall, there was tax revenue of around 830 billion euros, with the largest share going to the states, the federal government and the municipalities. The states received 355 billion euros, the federal government 314 billion euros and the municipalities 125 billion euros.

• Lohnsteuer: 218 Milliarden Euro
• Veranlagte Einkommensteuer: 72 Milliarden Euro
• Umsatzsteuer: 250 Milliarden Euro

With these clear figures it is clear that wage and income tax not only represents a significant source of revenue, but also plays an important role in financing public services and infrastructure. And while we continue to benefit from the positive effects, we should always be aware of how important an agile and fair tax policy is for the future.