The Solidaritätszuschlag, a surcharge on income tax, was first levied from 1 July 1991 to 30 June 1992. From 1995 it was levied again, without a time limit, to finance German unity. Since 2021 about 90 percent of those who paid it are fully exempt. In March 2025 the Federal Constitutional Court rejected a complaint against it. Such a surcharge need not be limited in time from the start, the court held. It must be abolished or adjusted only when the extra financial need behind it has evidently ended. Germans have a saying for this: Nichts hält länger als ein Provisorium, nothing lasts longer than a provisional arrangement.
economics
The Tax Return on a Beer Mat
In 2003 Friedrich Merz promised a tax system so simple that a tax return would fit on a beer mat. His concept had only three tax rates, 12, 24 and 36 percent. It was never put into law. Merz later said he had meant that a beer mat should be enough to calculate the amount of tax owed. The beer mat itself is now in the House of History in Bonn. In February 2025, during a television program, the presenter Günther Jauch dropped it. The museum’s president reported that it was undamaged.
A Mentality of Improvement
In April 2016 the Federal Agency for Civic Education published an essay on start-ups in Germany. Its authors, Nancy Richter and Thomas Schildhauer, wrote: Aber man muss wissen, dass die deutsche Innovationsmentalität eher inkrementelles Wachstum und damit die Verbesserung von bestehenden Produkten, Services, Prozessen und Geschäftsmodellen unterstützt. (But one must know that the German innovation mentality tends to support incremental growth, and with it the improvement of existing products, services, processes and business models.) Incremental innovation, they noted, needs investments whose use and results can be planned fairly well. According to the innovation reports, Germany is very well positioned in it.
The Bonus Almost Everyone Paid
In 2022 the federal government, the unions and the employers met in a revived Konzertierte Aktion, a concerted action against inflation. They agreed that employers could pay a bonus of up to 3,000 euros, free of tax and social contributions, until the end of 2024. Paying it was voluntary. Unions and employers wrote the bonus into numerous collective agreements. A survey by the union-affiliated Hans Böckler Foundation, published in July 2024, found that almost 26 million employees had received more than 52 billion euros in such bonuses. 77 percent of employees covered by a collective agreement received at least one payment.
The Midtech Trap
In April 2024 economists writing for the ifo Institute, among them its president Clemens Fuest, wrote that Europe and Germany are caught in a Midtech-Falle, a mid-tech trap. Much of the money for research goes into existing industries. Innovationen in Europa und Deutschland sind durch die Ingenieurskunst auf etablierten Feldern getrieben, they wrote, innovations in Europe and Germany are driven by engineering in established fields, such as the car industry. The authors called the concentration of German companies’ research spending on the car industry a great risk for the German economy. In September 2025 Germany fell from ninth to eleventh place in the Global Innovation Index. The president of the German Patent and Trade Mark Office called it Anlass zur Sorge, a cause for concern.
When the Neuer Markt Closed
On 10 March 1997 Frankfurt opened the Neuer Markt, a stock market segment for young growth companies. Its index peaked on 10 March 2000. In the following 31 months it lost more than 96 percent of its value, over 200 billion euros. Some companies had published misleading figures. The segment was closed on 5 June 2003. Ten years after its start, the magazine Computerwoche wrote that many shareholders remembered it mit Grausen, with horror. The crash had shaken many investors’ trust in shares for good, and many still kept their hands off them. According to the German Shares Institute, the number of shareholders in Germany had fallen by 2.5 million since 2000.
The Money Targets
From 1974 to 1998, the Bundesbank announced a target for the growth of the money supply every year. It missed the target as often as it met it. The targets ranged from at least 3 to at most 7 percent. The Bundesbank tolerated short-term deviations as long as the private sector saw them as temporary. It never lost sight of its long-term goal of price stability.
Costs Without End
German hard coal mining has ended, but some of its costs will never end. German calls them Ewigkeitslasten, eternity burdens. Water must be pumped out of the old mines permanently. Land that has sunk must be kept from flooding, and groundwater at former mine sites must be cleaned. The RAG Foundation was set up in 2007 to pay for these tasks from 2019 onward. A paper on its tasks put the expected spending from 2019 at about 220 million euros. If its assets are not enough, North Rhine-Westphalia and Saarland guarantee the financing permanently. A paper on the foundation’s tasks carries the title Ewigkeit ist eine Menge Zukunft, eternity is a lot of future.
Planned Cost Accounting
German cost accounting has a method named for the plan: Grenzplankostenrechnung, flexible marginal planned-cost accounting. It was developed in the late 1940s and the 1950s by the automotive engineer Hans Georg Plaut and the academic Wolfgang Kilger. Plaut published two articles on it in 1953 in the Zeitschrift für Betriebswirtschaft. As the name says, the method is built on planned costs. It is still taught at universities in the German-speaking countries and has been described as the standard for cost accounting in Germany.
Twenty Years to the Day
On 27 February 1953, West Germany signed the Londoner Schuldenabkommen, the London Debt Agreement. It settled the pre-war debts of the German Reich, among them the Dawes and Young loans of the 1920s. One part was set aside. The interest arrears from the years after the war were to wait until a possible reunification. Germany was reunified on 3 October 1990, and the claims came back. The last payment was made on 3 October 2010, twenty years to the day later. German Wikipedia gives it as 69.9 million euros. A Protestant news service reported that 75 million euros were still on the books at the end of June 2010.