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Austrian Union Opposes End To "Golden Handshake" Tax Perk

by Ulrika Lomas, Tax-News.com, Brussels

15 January 2014


President of the Austrian Federation of Trade Unions (ÖGB) Erich Foglar has warned the Government against plans to abolish the tax break currently accorded to so-called "golden handshakes."

In a communiqué, Foglar confirmed that the Government's proposed "tax burden package," which has recently been submitted for review, provides for an end to the golden handshake tax shelter. The union does not support the plans, Foglar made clear, insisting that the provisions are simply "unacceptable."

Highlighting the dangers of increasing the tax burden on severance compensation, Foglar argued that this would merely affect the wrong people. "Alarm bells" are already ringing in the union, following the Coalition's announcement, Foglar stressed.

Furthermore, Foglar urged the Government to swiftly introduce the envisaged bonus-malus scheme, designed to encourage businesses in Austria to recruit older workers.

Finally, Foglar advised the Government not to delay on its planned tax reform, underscoring that a working group must swiftly begin work on a major overhaul of taxation. While there is a certain degree of understanding for the budgetary constraints currently facing the Government vis-à-vis future tax cuts, the alliance must nevertheless use the time waiting for economic recovery to prepare for the reform, he said.

Concluding, Foglar reiterated that the ÖGB's motto of "more net from gross" pay still stands.

TAGS: tax | business | budget | Austria | tax breaks | tax reform | Trade Union | individual income tax

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