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“We must stop this massive and anti-social tax increase”
When wages rise, taxes rise disproportionately. Now there is political resistance.
FDP Council of States Andrea Caroni (AR) wants to intervene.
Image: Peter Klaunzer/Keystone
If wages rise due to inflation, the progressive tax rate table is automatically adjusted upwards. This should, according to the legislator, compensate for the “cold progression”. The situation is different with “warm progression”: if wages rise in real terms thanks to productivity growth in society as a whole, the state does not intervene. As a result, the working population gradually climbs up the tax rate brackets. And they do so faster than they can climb the pay scales because of the progressive tax system.