In Germany there is no family splitting, but rather spouse splitting. Critics say the state is promoting "housewife marriage" and not children. Before elections, family splitting based on the French model is often an issue. Nothing has changed since 1953.

By Stephan Lenhardt, SWR Mainz

The debate about family splitting is basically about whether the state is more likely to encourage children or marriage. If you want to understand family splitting, you first have to understand what is known as spouse splitting.

Spouse splitting in Germany

With spouse splitting, the incomes of spouse A and spouse B are first added together – and then divided by two. So split. The tax is then levied on the income calculated in this way. If a partner earns significantly more, the tax savings are even greater. Because the German tax system is progressive. That means: the more someone earns, the more tax they have to pay. And so it can be worthwhile to split part of your own income to the partner with lower tax rates.

Promotion of housewife marriage?

Critics have long complained that children do not play a role in this system at first. For tax purposes, marriage is worth more to the state than children.

And that system promotes housewife marriage. Because the second earner with a lower salary, mostly still women, is practically prevented from working. Because it’s not financially worthwhile. The Frankfurt economist Prof. Nicola Fuchs-Schundeln recently confirmed this in a study.

Family splitting – an alternative?

Family splitting is now coming back into play as an alternative. 

This tax model takes children into account. In France even regardless of marriage. Put simply, it works like this: The family’s income is added up. And then split up among all members – including the children. From the third child, the tax incentive in the neighboring country is even higher. 

Spouse splitting costs 22 billion euros

The splitting of spouses in Germany is a gigantic subsidy. If there were no spouse splitting, the state would earn around 22 billion euros more. That is how high the Federal Ministry of Finance puts the effect of splitting. In 2017, around 13 million married couples are expected to benefit from spouse splitting. This is probably one of the reasons why an alternative such as family splitting has so far only been an issue before the federal elections. After that, nothing has changed so far.