re: Berlin DIE LINKE economic agenda vs. real estate corporations/taxing
via fb-feed:
This is an economics analysis by Italian historian/politician Alessandro Volpi (maybe the Italian desk among commentariat can weigh in):
machine-translation from Italian to English via google
“(…)
In Berlin, the victory of Elif Eralp—a leading candidate for *Die Linke* who ran on a platform that is finally radical—now seems certain.
Her platform embodies a strongly redistributive vision focused on combating financial speculation, addressing the housing crisis, and deeply reforming both local and national tax systems.
Housing lies at the heart of the city’s debate; a combination of early-2000s privatizations and intense financialization has concentrated vast swathes of the private housing stock in the hands of a few corporate groups.
Prominent among them is Vonovia SE—along with Deutsche Wohnen, which it acquired in 2021—controlling over 140,000 apartments in the capital and standing as Germany’s largest operator in the sector.
They are followed by international giants such as the Swedish group Heimstaden, which manages between 20,000 and 25,000 homes, and the Franco-Italian firm Covivio, with approximately 15,000 to 18,000 units.
Also involved are private equity vehicles like the US giant Blackstone and long-established groups such as the Adler Group, which previously held portfolios exceeding 20,000 properties.
In total, major financial players and private investment funds manage between 200,000 and 250,000 Berlin apartments.
In short, Berlin has been transformed into a financial product, and Elif Eralp has clearly taken a stand against this fundamental—almost genetic—mutation.
To break this oligopoly, their response entails the immediate implementation of the 2021 referendum (*Deutsche Wohnen & Co. enteignen*), initiating the expropriation—with compensation—and public acquisition of approximately 220,000 apartments owned by private companies and groups holding more than 3,000 units.
This expropriation measure is coupled with a proposal for a strict rent freeze—applied primarily to the 380,000 municipally owned homes—the creation of a public inspection authority to combat high rents, and a planned expansion of social housing.
Taxation serves as the second pillar of Die Linke’s strategy, designed both to discourage rent-seeking and to generate fresh revenue for essential services.
To directly target high-end real estate assets, Eralp and her party propose a new “luxury villa tax” applicable to properties with an estimated value exceeding €4 million—a measure that would affect, among others, over 3,000 historic properties in the affluent Grunewald district.
The introduction of this surcharge alone, along with related reforms concerning secondary properties, is projected to bring in between €150 million and €300 million in additional annual revenue for the capital—funds to be earmarked specifically for rent-freeze policies and housing initiatives.
These measures are complemented by an increase in the tax on unoccupied second homes, a ban on so-called “share deals”—corporate transactions allowing large funds to avoid property transfer taxes by purchasing shares rather than individual buildings—and a full exemption from the property purchase tax for low- and middle-income families buying their first home.
Eralp’s economic program also addresses the national dimension of taxation: a key proposal involves reintroducing a tax on large fortunes, structured with an initial exemption threshold of €1 million in net assets and progressive rates ranging from 1% to 5% for larger fortunes.
According to institutional studies cited during the campaign debate, simply reintroducing the wealth tax would allow Berlin’s budget to generate over €5 billion annually—funds that could finance free or heavily subsidized urban public transport, childcare facilities (*Kitas*), and school modernization. On the corporate front, the program also calls for raising the corporate tax rate for multinationals to 25% and imposing a windfall tax on the excess profits amassed by energy giants.
As it happens, the AfD is not surging in Berlin.
Yet in Italy, similar positions would be decried as a form of “egalitarian blasphemy.”
(…)”
