Will ‘crazy’ tax leave Berlin unable to compete?

berlin

Updated: What makes a city competitive for startups? VCs, angels and cheap desk space, to be sure, but also nuts-and-bolts stuff like transport and taxation.

As Om noted in December, Berlin’s airports are quite small, but the city had a plan. The two currently operational airports — Tegel and Schoenefeld — were supposed to be replaced in June by a new mega-airport, Berlin Brandenburg.

But then disaster struck. In a sore blow to anyone still harbouring stereotypes about German efficiency, officials admitted at the start of May that the airports fire safety systems were not yet ready. And yesterday it emerged that the opening date has been pushed back by an embarrassing nine months to next March.

This is humiliating for the German capital, a city that wants to reposition itself as one of the world’s premier technology hubs, and — as a result — has upset a number of local companies.

“The airport screw up is really sad and not worthy of a capital city in Europe. It looks really unprofessional,” Benedikt Lehnert, the chief marketing officer of productivity startup 6wunderkinder told me.

However, the company does not think it will have any direct impact on the startup scene – a view shared by others I spoke to. What they’re far more worried about is a new compulsory pension contribution for freelancers aged under 30, that’s set to kick in from mid-2013.

‘Crazy’ taxation

The government is forcing young freelancers to pay into their pension pot, something that has been causing quite a stir recently — infact, a petition against it has racked up almost 60,000 signatures. But what’s the problem here? Pensions are good, right?

People might be a bit more enthusiastic about the move if it weren’t for the fact that the contributions (€250-€300 a month for the pension and €100 for disability insurance) are not going to be linked to income. And the fact that the minimum earnings threshold for the scheme is just €400 a month. You do the math.

As Gidsy CEO Edial Dekker told me, it’s “crazy that freelancers have to pay for the broken pension system,” particularly given the high levels of health insurance and social security that they already have to pay.

“Instead of helping freelancers, they’re being charged with something that is very likely not going to be beneficial for them personally later,” Dekker said. “I think one of the most exciting things about our generation is that a lot of people are doing small jobs and that no one thinks about working for the same employer for the upcoming 30 years. It’s good, and should be supported.”

6wunderkinder’s Lehnert also took the stance that being a freelancer is not just a job but “a starting point into self-fulfilment”.

“But starting as a freelancer isn’t always easy and being forced to pay a lot of money might stop a lot of people to start their own business,” the company warned.

That said, not everyone agrees on this point. Prominent local angel and Phonedeck co-founder Christophe Maire called the issue “a false problem.”

“Great companies are not — as a rule — built by freelancers but by full-time core employees dedicated to a product,” Maire argued.

“This freelancer thing is so 90s.”

Update: This post has been updated to clarify which team member at 6wunderkinder we spoke to.

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