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Germany's Lafontaine wants 80 pct top tax rate

Published 11/14/2008, 05:20 AM
Updated 11/14/2008, 05:22 AM

BERLIN, Nov 14 (Reuters) - Corporate high fliers in Germany with "shameful" incomes above 600,000 euros ($750,000) should have to pay 80 percent income tax, former German finance minister Oskar Lafontaine told a newspaper.

Lafontaine, who used to be head of the centre-left Social Democrats (SPD) and now leads the more radical Left Party, told daily Passauer Neue Presse the financial crisis showed there was scope for a tax on millionaires to address rising inequality.

"The best solution would be to raise the rate of taxation on incomes above 600,000 euros to 80 percent in one go," he said in the Friday edition of the newspaper. "All shameful incomes would be included in this."

The current top tax rate is 45 percent for people with an annual income of more than 250,000 euros.

Under Lafontaine -- once dubbed "Europe's most dangerous man" by a British tabloid -- the Left has become the third most popular party in Germany at a time when government ministers are warning financial unrest could encourage populist rhetoric.

Built around the remnants of the East German communist party and disaffected SPD left-wingers, the Left has led polls in the east of the country for much of this year, increasing pressure on more moderate, established parties to work with it.

Earlier this week, Finance Minister Peer Steinbrueck, a member of the SPD, said popular disaffection with the excesses of capitalism could lead to a rejection of mainstream parties and encourage people vote for politically extreme movements.

In 1998-1999, Lafontaine, 65, served as Finance Minister under former Chancellor Gerhard Schroeder. Breaking with Schroeder acrimoniously, Lafontaine left the SPD in May 2005. (Reporting by Dave Graham; editing by Keith Weir)

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