1 minute read | September.30.2026
Deutsch: Mitarbeiterbeteiligungen nach § 19a EStG: gelungenes Gesetzeskonzept, das Erweiterung verdient
In the 30 September 2026 edition of Frankfurter Allgemeine Zeitung (FAZ), Germany’s leading daily, Stefan Schultes-Schnitzlein and Carsten Engelings argue that Germany's favorable tax regime for employee equity participation should be extended well beyond the start-up sector.
Section 19a of the German Income Tax Act (EStG) helps companies to issue equity stakes to employees at a discount. The key advantage is a tax deferral on employment income: income tax on the discount is regularly levied only when the employee later sells the participation and can be paid from the sale proceeds. In addition, value increases between issuance and sale are taxed at roughly max. 30 percent rather than the approximately max. 50 percent applicable to employment income (excluding church tax, the percentages are lower in each case).
The authors argue that the regime's scope is too narrow. They question why companies older than 20 years are excluded, why certain foreign legal forms do not qualify, and whether the employee count, revenue, and balance sheet thresholds are necessary.
The authors' central message: the German legislature's approach is too good to be confined to start-ups. While broadening the regime would affect tax revenue in the short term, deferred tax is not forgone tax – and extending sound policy more broadly would benefit employees across the economy as well as Germany as a business location.