The real problem is tax evasion, not the recipients of aid.
Germany loses more than 200 billion euros annually due to tax evasion, according to Florian Köbler, head of the German Tax Officials' Union (DSTG), in an interview with BuzzFeed News Deutschland, part of the IPPEN.MEDIA group. Irregular employment, which also contributes to the increase in cash circulation in Europe, is part of these losses.
Lars Klingbeil, the new Deputy Chancellor and Minister of Finance from the Social Democratic Party (SPD), announced the government's intention to strengthen the fight against tax evasion and undeclared work. He explained in a press conference before the announcement of the annual customs report in Hamburg that, despite a shortage of personnel, better results can be achieved by using current employees more efficiently.
Klingbeil confirmed: "The problem of illegal work has existed for years, but I have only been Minister of Finance for three weeks." He also pointed out that his predecessor, Christian Lindner from the Free Democratic Party (FDP), did not show the same enthusiasm for combating these crimes and instead focused on reducing Bürgergeld (citizen allowance) expenses.
The figure illustrates the gap between the reality of fraud and public debate: In 2022, the total fraud in citizen benefits amounted to about 272.5 million euros, which is 700 times less than the losses caused by tax evasion.
Nevertheless, the negative public perception of welfare recipients still exists, as they are portrayed as lazy or fraudulent. Sociologists explain this by saying that the complexity of the system generates emotional reactions and distorts the facts. One commentator on LinkedIn says: "The discussion about Bürgergeld often aims to divert attention from the real fraudsters, who are those evading taxes."
Kobler called on the new government led by Chancellor Friedrich Merz and his deputy Klingbeil to implement reforms in the tax declaration system, including tackling widespread tax evasion through shell companies or VAT fraud. However, he also warned against underestimating citizen benefit fraud, stating: "Criminals are draining the state at all levels. We must restore people's trust in the state through justice, whether in taxes or social assistance." He noted that there are cases where Bürgergeld fraud overlaps with black labor.