German court rules gay couples should have equal taxation rights

Four months head of the general election, Germany's ruling Christian Democratic Union (CDU) is split over a landmark court ruling handing extra tax breaks to gay couples. Yesterday Germany's highest court in Karlsruhe ruled unconstitutional a distinction in Germany's tax code between gay partnerships and married couples.

All political parties welcomed the well-flagged ruling – except the CDU and its leader, Chancellor Angela Merkel. This morning she will sound out party grandees on how best to proceed in what could be an electoral minefield.

Urban vote
On the one hand, embracing gay couples fits nicely with Dr Merkel's push to modernise the CDU and push to the political centre in pursuit of the younger, urban vote. With that in mind she has already thrown overboard core party doctrine, from nuclear power to military service – so much so that older, conservative CDU voters complain they no longer know what their party represents.

Legislating for gay tax breaks may see them withhold their crucial support in protest on election day in September.

Civil partnerships for same-sex couples were introduced in 2001 by the then SPD-Green government with restrictions on tax, inheritance and adoption laws. While adoption remains off-limits, inheritance law has been equalised and now this a landmark legal ruling that, both in fiscal and political terms, is an earthquake.

At stake was Germany’s spousal split tax rule, dating back to the 1950s, which allows married couples pool and then halve their incomes for tax purposes. For couples with one income, or very different earnings, it can reduce their tax bill significantly.

CDU conservatives said this tax break was an intrinsic part of the special protection Germany’s post-war constitution afforded to the family. Critics of the status quo said this was an outmoded world view that failed to recognise the variety of family models.