Our goal is the transgression of the social into a social and ecological market economy, with prices telling the ecological and social truth: costs are neither hidden nor imposed on third parties, society or future generations, but are transparently allocated to the originators. Subsidies promoting environmentally harmful economic activity are reduced. Tax policy encourages ecologically and socially compatible economic activity and charges unsustainable business models. This gives the state the necessary scope to finance its current tasks and to reduce the debt burden of future generations. The guidelines of the market economy are designed in such a way that it is economically rational for individuals and companies to behave in a sustainable manner. Market forces no longer work against, but for the environment. Only a market economy that respects our environment and prioritises the common good can reconcile the economic, ecological and social goals of our society.
With the way we finance our community we have the opportunity to shape our country. What we pay taxes for and what the state subsidises influences how we live and work. An efficient tax system should tax what should be avoided and not what is socially desirable ("tax bads, not goods"). The guiding principle should be that those who behave in an environmentally friendly way benefit from it. Contrary to this requirement, the state today is financed almost two-thirds by taxes on labour and less than five percent by taxes and levies on the use of natural resources – with a tendency to fall for years.
More on topic page “Environmental financial reform”
Prices have a very central function in the market economy and therefore have to tell the economic and ecological truth. They signal value and scarcity, control supply and demand and should ultimately lead to an efficient distribution. The social costs of environmental pollution, the climate crisis, the extinction of species and the consumption of resources are not yet adequately reflected in prices. In too many areas we externalize the costs of our economic activity at the expense of third parties, society, other countries or future generations. This is why we advocate true cost economics and the internalisation of external costs through economic instruments such as a carbon price, emissions trading, energy and resource taxes or tolls.
The German state grants more than 50 billion Euros a year in environmentally harmful subsidies (almost the same amount as the state receives annually in environmental taxes). The tax exemption for kerosene, a reduced tax rate for diesel, exceptions for industry in the taxation of energy, exemption from VAT of international air traffic and company cars account for the largest part of subsidies. They have a serious impact on the environment and are often socially unjust - because the wealthy benefit most from them. Subsidies create economic false incentives, create path dependencies, impede the abandonment of coal, oil and gas and place a double burden on society: it pays the subsidy and later bears the follow-up costs. We therefore advocate the reduction of environmentally harmful subsidies at the national and international level.