German Minijob Reform to End Tax‑Free Status Affects Nearly 7 Million Workers

Germany plans to abolish the tax‑free status of miniature jobs (Minijobs) starting 1 July 2026. The reform will require all workers earning above the €603 monthly threshold to pay full social‑security contributions, ending the long‑standing exemption that let most of the estimated seven million minijobbers avoid pension, health, care and unemployment insurance fees. The monthly contribution total is projected at €130.73, split between pension (9.3 %), health (8.75 %), care (2.4 %) and unemployment (1.2 %).\n\nEmployers anticipate higher labour‑costs and administrative changes, while trade associations warn of potential job losses and a rise in undeclared work. The German Retail Association cites Baden‑Württemberg, with 1.22 million minijobbers, as especially vulnerable. Unions and some economists endorse the move, arguing that it will reduce future old‑age poverty and encourage transition to fully insured employment. The reform also foresees a mandatory funded pension model modelled on Sweden by 2028, and the pension commission will adjust related parameters accordingly.