tax: the biggest hindrance of the German economy
Jul 29th, 2008 by ellen
I watch ARD’s Börse report (equity market report) at around 19:55 almost everyday. Today a gentleman in the program said, in countries like Sweden and the Netherlands, 30+% citizens hold stocks. In Germany, only around 5% citizens are shareholders. The gentleman said this is not a good sign, the Abgeltungssteuer (capital gain tax) for long-term investment has to be reduced. I cannot agree more. I hope the policy makers in the German government can also hear what he had said. Let’s prey hard for the reduction of the long-term capital gain tax!
Like I’ve said in my previous blog entries, German people should be educated to employ the capital market for fighting against the pension deficiency and inflation. The current situation is, people are used to count on the government and there lacks the motivation of individual effort. In a high-tax, high-welfare (the welfare in Germany is no longer that high) environment, people who work really hard and are really smart cannot get much more than average people. People who do not work merely out of laziness can always count on the other tax payers and still lead a happy life. Entrepreneurs have very heavy tax burden. Individuals have very little left for building wealth after the heavy tax.
The high tax policy in Germany might had worked out well in the past. But the world has changed. It has become more competitive than ever before. The government must wake up every individual’s inner drive, inner passion to keep the German economy from going ahead. Less tax please. If individuals have more net income, government providing less welfare does not hurt that much to individuals.
The other day I watched a talk show. A German lady said she does not understand why some schools in Germany do not provide free lunch, she thinks it’s government’s duty to feed pupils/students in schools. Well, here is my own story. In the middle/late 1980s when I was a primary school pupil, my parents together earned less than 40 euros per month. The lunch in my school was not free. It cost about 2 euros per month. And, all the other trainings I had outside the school during my childhood were not free. My parents had made it. Millions of parents in China had made it. I don’t understand why some people, already with the help of governmental Kindergeld, still cannot pay the lunch for their children and demanding more welfare. Instead of offering more cash, the government should invite them to lectures on personal money management.
Why you are poor written by Jason Kelly is an excellent demonstration of the sin of high tax. I mentioned Jason Kelly’s book in a previous entry. His English is amazingly expressive without too much fluff. Jason is surely highly talented in how to tell a thing. I read his blogs from time to time to learn English and writing, and investing of course.
