Angela Merkel's Christian Democrats have drafted proposals forcing all those over the age of 25 to pay a proportion of their income to cushion Germany against a looming population crisis.
The German Chancellor's ruling party is seeking extra sources of cash to pay for soaring pensions and bills for social care costs at a time when Germany's "baby boomer" generation is ageing amid a decline in the birth rate.
The proposals – to be adopted by Chancellor Merkel's party cabinet after the Easter break – have not yet set a figure on the age tax but officials are considering a special levy of about one per cent of income.
A slump in Germany's population means that as more and more ageing Germans retire there are less and less young workers to replace them as taxpayers to fund generous welfare and pension arrangements.
Estimates from Germany's federal employment agency, predict that the workforce will be reduced by seven million people by 2025. » | Bruno Waterfield | Wednesday, April 04, 2012
