Vienna to expand employer levy as planned

Vienna will expand its employer levy as planned after coalition partner NEOS agreed to the change, ORF reported. The city expects the expansion to bring in about 17 million euros in additional revenue each year.

The changes will bring previously exempt groups, including people in freelance employment relationships, into the scheme. The age limit of 55 will also be removed; employers currently do not pay the levy for older workers.

The city government plans to approve the measure next week, with implementation scheduled for the first quarter of 2027. The levy, which has existed since 1970, is earmarked for construction of the Vienna underground railway. Employers pay two euros per person for each working week, and that rate will remain unchanged.

The planned reform had caused disagreements in Vienna’s governing coalition. NEOS had argued that two exemptions were agreed to ease the burden on businesses. Finance councillor Barbara Novak of the SPÖ said the coalition partners had now reached an agreement and that the additional revenue would remain earmarked for the underground expansion.

NEOS confirmed the agreement and said it had secured a condition that there would be no increase and no new fees or levies in 2027.