Tax Reform Will Be Valid from September 1 on

PeopleOther ♦ Published: August 31, 2020; 13:53 ♦ (Vindobona)

According to Finance Minister Blümel, the tax reform will be valid on from September 1 and there will be a corresponding refund for salaries already taxed with retroactive effect from 1 January 2020.

Minister Blümel announced today that the tax reform applies retroactively from January 1 on. / Picture: © Bundeskanzleramt (BKA) / Andy Wenzel

From September on the yearly wages from 11,000 to 18,000 euros are taxed by 20% instead of 25%. This reform will apply retroactively from January 1 on.

According to Finance Minister Blümel, this will lead to a tax relief of 1.6 billion euros yearly. In Vienna only there are already 1.1 million people who benefit from this reform.

Moreover, for each child which receives family allowance a bonus of 360 euros will be paid in September.

The third measure to relief taxation is an increase in the social insurance pay back. Workforce which has a yearly income of less than 11,000 will receive a surcharge to the traffic deduction amount of maximum 400 euros instead of the previous 300 euros.

Additionally, the social insurance bonus within the social insurance pay back will be increased to 400 euros. These measures will be valid already for the calendar year 2020.

It is possible to calculate the individual savings online at the website of the ministry for finance.