Despite Open Questions: Flat Tax for Working in Retirement to Come in 2026

"We are working hard to meet the date," said SPÖ State Secretary and government coordinator Michaela Schmidt on Wednesday after the cabinet meeting regarding the flat tax for work during retirement.

Unresolved Issues Regarding the Flat Tax for Work During Retirement

"There are complex issues that still need to be clarified," stated the State Secretary, without going into detail about unresolved points. One key issue is likely whether the flat tax should only apply to employees, as Finance Minister Markus Marterbauer (SPÖ) recently explained. The ÖVP, on the other hand, wants self-employed individuals to also benefit from the lower tax rate.

The government program stipulates that "the additional income of employees will be taxed at a final rate of 25 percent" if they continue to work during retirement. Employees are also to be exempt from social security contributions, while employers will only pay half the contribution. "The cap for the preferential income is yet to be clarified," states the coalition agreement. The cost to the state budget is estimated at 300 million euros for 2026. In 2027, it is expected to be 470 million.

(APA/Red)

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