The removal of the middle class bulge - models and costs

The Ifo Institute prepared a study on the income tax burden of middle-class income earners in Germany (the so-called “middle-class bulge”) on behalf of the Initiative Neue Soziale Marktwirtschaft (INSM). The middle-class bulge gives rise to swiftly rising marginal tax rates. As a result, middle-class income earners are often considered to be the social group most heavily impacted by taxes and duties. The study entitled: “The removal of the middle class bulge - models and costs” – prepared by the Ifo Center for Public Finance and Political Economy – presents income tax reform options and quantifies their impact on tax payers and public budgets, using the Ifo income tax simulation model (Ifo-ESM).