Germany raises top income‑tax threshold to €70,600

Germany’s coalition government of the Union and SPD approved a modest reform of the top income‑tax bracket. The income level that triggers the 42 % top rate will be lifted from €69,879 to €70,600, with the change phased in during 2027 and 2028. The statutory rate itself remains unchanged.

Economists and taxpayer associations say the adjustment will affect only a narrow band of earners and provide little real relief to millions of workers. Analysts note that the “middle‑class belly” of the tax system – the steep rise just above the basic exemption – remains largely untouched, limiting any substantive impact on disposable incomes. Critics describe the measure as largely symbolic, arguing that a more substantial reform would be needed to address the widening gap between average wages and the top‑tax threshold.