2023-08-31 16:40:11
Federal Ministry of Finance in Berlin
Under FDP Finance Minister Lindner, subsidies in Germany have reached record levels. His party now wants to remedy the situation.
(Photo: IMAGO/Jürgen Ritter)
Berlin Subsidies in Germany will reach a new record high in the coming years. While federal financial aid and tax breaks were still 37.9 billion euros in 2021, they will increase to 67.1 billion euros by 2024 – an increase of more than 29 billion euros. This emerges from the new subsidy report of the federal government.
Actually, the traffic light coalition started with a promise to reduce subsidies. But little has happened so far. The FDP is now demanding the introduction of a statutory subsidy brake. According to information from the Handelsblatt, the parliamentary group intends to make a corresponding decision at its closed meeting in Dresden on Friday.
“The new subsidy brake forces us to prioritize and helps to consolidate the federal budget in the long term,” said FDP parliamentary group leader Christoph Meyer. “It is now necessary that we examine what state support really meets the originally intended goal and what can be eliminated.”
According to the ideas of the Liberals, new subsidies should in future be limited to a maximum of five years. In addition, an independent evaluation is planned to determine whether the state aid really serves its purpose. In addition, two existing subsidies are to be canceled for each new subsidy. “We are thus implementing the plan from the coalition agreement to reduce superfluous and ineffective subsidies and expenditure,” said Meyer.
Many governments have already decided to reduce subsidies. However, the implementation usually fails due to resistance from the beneficiaries. In addition, the traffic light coalition has so far disagreed on what exactly should be deleted. The Greens see the commuter allowance or the tax rules for company cars as climate-damaging subsidies. The FDP sees a tax simplification in the rules.
>> Read here: How the traffic light could save around 79 billion euros
As can be seen from the federal government’s subsidy report, direct financial aid from the federal government in particular will increase, by around 30 billion euros to 48.7 billion euros in 2024. Tax breaks, on the other hand, fell slightly over the period. They will fall from 19.5 billion euros in 2021 to 18.4 billion euros in 2024.
According to the report from the Federal Ministry of Finance, a large proportion of the subsidies are “strongly influenced by climate and environmental policy”. “In addition to climate protection as a core political concern, current funding priorities continue to lie in the areas of housing construction, digitization and mobility.”
The largest financial aid is the promotion of energy-efficient building renovation with 18.7 billion euros in the coming year. This is followed by financial support in the field of microelectronics with around four billion euros. This funding priority is a new addition. Support for hydrogen projects (€2.5 billion) and the expansion of charging stations for electric cars (€2.2 billion) also tops the list.
>> Read more: Federal government and Intel shortly before agreement: Subsidies for chip factory are to rise to 9.9 billion euros
When it comes to tax breaks, the privileges for company heirs are the largest subsidy at 4.5 billion euros. This is followed by the reduced VAT rate for cultural assets (EUR 4.3 billion) and the tax exemption for holiday and night work (EUR 3.2 billion). During the discussion about a possible reduction in subsidies, the SPD has already made it clear that a cancellation of these tax breaks cannot be done with it.
More: Traffic light coalition announces restart of government work
#Federal #subsidies #increase #billion #euros #FDP #calls #brake