Spindelegger: Defeated by tax reform

Former Finance Minister Michael Spindelegger resigned on Tuesday after eight months in the role, over differences within the conservative People’s Party (ÖVP) over how to overhaul Austria's tax system and reduce its debt. What will his legacy be?

Spindelegger: Defeated by tax reform
Michael Spindelegger. Photo: APA/Schlager

Spindelegger also stepped down as Austria's vice chancellor and head of the ÖVP, the junior partner in Austria’s governing coalition.

At a surprise news conference, Spindelegger said he resigned due to a lack of support from his own party. "When there is no cohesion, it is time to hand over the reins," he told reporters.

Some ÖVP members have backed calls for tax cuts from its coalition partner, the centre-left Social Democrats.

Instead of cutting taxes, Austria should focus on cutting its debt, which is expected to reach about 80% of gross domestic product this year, Spindelegger said.

"The Austrian way must be oriented toward Berlin and not toward Athens," he said.

However, Gerald John of Der Standard newspaper writes that what Spindelegger didn’t understand is that no one wants to hear about the looming menace of national debt, and the need for savings and belt-tightening – what they want to hear is when their income tax is going to be reduced.

Tax reform was Spindelegger's stumbling block, and the issue that made him so unpopular, writes John.  

For many within the coalition a tax cut is seen as a way to woo voters and ensure success in the next elections (2018), as well as a way to boost the economy by giving workers more spending power.

But Spindelegger always maintained that this was the wrong approach.

"New debts are irresponsible towards the next generation, and I don’t want to be a part of that," he said in his parting words.

The Social Democrats want to introduce taxes on inheritance and a "millionaires tax" on the super rich – an idea Spindelegger rejected as a "drop in the ocean".

He had been a target of criticism from within his own party even before the debate over taxes. He has been a "dead man walking for many months," said political commentator Peter Plaikner.

Voters expect politicians to solve problems, not to give constant warnings that everything is going down the drain. A senior ÖVP figure referred to Spindelegger as a “Cassandra” – but only time will tell if he was actually the voice of reason.

Spindelegger was criticized for his inability to assert his policies and for some of his cabinet choices when building the government. He was viewed by some as too conservative even for the centre-right ÖVP.

With his wife, Margit. Photo: APA/Hochmuth

Many politicians from both sides of the government were surprised by Spindelegger's resignation, but seemed certain that the coalition would be able to overcome the loss of one of its party's leaders.

The day after his resignation Spindelegger had an “impromptu interview” with a sports editor in the changing room of a well-known Vienna fitness club. The 54-year-old was described as “looking 15 years younger” and “beaming”.

"It's also about having some dignity in life, I feel wonderful," Spindelegger said. His immediate plan was to clear his office and fly to Luxembourg, where his wife works – and after that – no long term plans as yet.  

Good luck to his successor as ÖVP chairman, Reinhold Mitterlehner. Germany's Süddeutsche Zeitung commented that whoever takes over the ÖVP “is on a suicide mission and will die a quick political death.”

Editor's Note: The Local's Austrian of the Week is someone in the news who – for good or ill – has revealed something interesting about the country. Being selected as Austrian of the Week is not necessarily an endorsement.

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Austrian presidential elections: Why 1.4 million people can’t vote

Due to Austria's strict rules on citizenship and growing number of international residents, the number of people that are not allowed to vote is increasing.

Austrian presidential elections: Why 1.4 million people can't vote

The election of Austria’s Federal President will take place later this year on October 9th and the upcoming vote is once again raising the topic of citizenship and voting rights in the country.

The Kurier reports that 18 percent of residents (or 1.4 million people) in Austria over the age of 16 do not have the right to vote because they are not citizens, with the highest concentration of ineligible people in Vienna, Innsbruck and Salzburg. 

As a comparison, 20 years ago there were just 580,000 people without the right to vote in Austria.

FOR MEMBERS: Could Austria change the rules around citizenship?

Statistics Austria data evaluated by the APA shows that around 30 percent of the voting age population in Vienna, Innsbruck and Salzburg are not entitled to vote. In Linz and Graz, it is around 25 percent.

However, there are some smaller communities in Austria where the number of people without the right to vote is even higher.

In Jungholz in Tyrol, 66 percent of the population are not eligible, followed by 51 percent in Mittelberg in Vorarlberg. Kittsee in Burgenland and Wolfsthal in Lower Austria also have high proportions of Slovakian residents who are not able to vote.

Who is eligible for citizenship in Austria?

Currently in Austria, if someone wants to take up citizenship via naturalisation they have to undergo an extensive and expensive process and fulfil specific criteria.

Generally, there needs to be at least 10 years of lawful and uninterrupted residence in Austria. But there are exceptions for those with citizenship of an EU or EEA country, those born in Austria, or married to an Austrian, for example.

READ MORE: IN NUMBERS: One in four Austrian residents now of foreign origin

The main hurdles, however, include having to give up any other citizenships, as Austria doesn’t allow for dual citizenship in naturalisation cases with few exceptions, and the payment of a high fee, which depends on the municipality.

In Vienna, the application costs €130. If successful, the new Austrian citizen can expect to pay from €1,100 to €1,500 just for the award – that doesn’t include costs with documentation, translation, and issuance of documents such as an Austrian passport.

The tricky topic of Austrian citizenship 

Most international residents in Austria do not pursue citizenship as it means revoking citizenship of their home country.

But the Kurier reports that political scientist Peter Filzmaier has warned there could be negative consequences if large sections of the Austrian population remain unable to vote.

Filzmaier said: “Since people are affected by the decisions of the political system in their place of residence, it could also be linked to their place of residence instead of citizenship.”

READ ALSO: EXPLAINED: How does Austria’s presidential election work?

In May of this year, Federal President Alexander Van der Bellen also raised the topic of easing citizenship rules when he told an interviewer that the “hurdles” for Austrian citizenship are too high.

So far though, any discussions surrounding citizenship reform have been dismissed by the Austrian People’s Party (ÖVP) and the Freedom Party of Austria (FPÖ).

Additionally, political scientist Flizmaier advises any further debate on the issue to take place outside of election time when there is less “emotion”.

READ ALSO: Five of the biggest challenges facing Austria right now

Will Austria change its citizenship rules?

While junior partner Greens have been in favour of easing some rules, little is expected to happen with the ÖVP in power.

The next parliamentary elections are set for 2024, though. If the SPÖ continues climbing in the polls, an SPÖ-Green coalition could push forward different rules.

Also, if the Red-Green-Yellow ruling coalition in Germany does succeed in easing naturalisation rules in the neighbouring country, Austria could see further pressure for domestic changes.

But that remains to be seen, mainly depending on the 2024 election results.