2023-08-30 14:46:10
The German government has presented a program to “relaunch the economy and growth”, including 7 billion euros in tax relief for companies.
Finance Minister Christian Lindner’s “Growth Opportunity Act” is at the heart of the 10-point package adopted by the coalition on Tuesday, to relaunch a flagging economy, which entered recession in the second quarter and once more haunted by the specter of “the sick man of Europe”, which she had been in 1999.
“We want to do everything to revive our growth, which would support much more dynamics, explained Tuesday Olaf Scholz at the end of two days of work with his green and liberal coalition partners. Germany is a country with a strong economy. , which must overcome the challenges of inflation and declining exports. Companies need to be encouraged to invest.”
The “Growth Prospects Act” will cost the state 32.4 billion euros by 2028, in the form of tax relief for companies, at the rate of 7 billion euros per year. “It is not a question of a diversified recovery plan, it would be useless and even counterproductive, specifies the Minister of Finance Christian Lindner. It is rather a question of giving the impetus so that the opportunities which exist are exploited .”
The measure – half of which will be borne by the federal state and the Länder – provides for various points such as the adjustment of depreciation for movable property and for buildings, in order in particular to relaunch housing construction (the coalition had promised 400,000 homes per year). An investment premium to encourage climate protection projects is also planned, as well asone billion euros to promote the development of start-ups.
A plan to reduce bureaucracy
The government also presented yesterday the outline of a plan to reduce bureaucracy, which will benefit the hotel industry among others and save businesses more than 2 billion euros a year. This plan also plans to reduce the obligation of paper archives for companies from 10 to 8 years. The progress is welcomed by the business community.
Even if the employers’ federations deplore the lack of agreement within the government on another file, that of the supervision of the price of electricity for the most energy-intensive sectors such as chemicals. At the start of the week, seven Länder had sent an open letter to the government asking for the “establishment of a competitive electricity price at the international level”. The Länder are afraid to see the continued exile of their companies to the United Stateswhere energy is cheap.
According to a recent survey by chambers of commerce and industry, 10% of German business leaders plan to relocate part of their production to the USA, attracted by the low cost of energy and the plan to fight once morest Biden government inflation. Unusual fact, the industrialists and the Länder support on this file the project of the Green Minister of the Economy Robert Habeck, to subsidize the price of electricity for industrial customers, in order to limit it to 6 cents per kwH for at least five years.
But the finance minister – who is more in favor of cutting electricity taxes – has so far vetoed the plan to subsidize cheap electricity: “We cannot charge all taxpayers, all businesses, bakers and craftsmen, SMEs, to finance a reduction in the price of electricity for a handful of large groups”, decides the minister on this subject. Olaf Scholz is equally skeptical. The file might in any case be rejected by the European Commission
The summary
- The German government has adopted a 10-point scheme to revive the economy of the country which is at half mast.
- The flagship measure is the reduction of charges for companies, up to 7 billion euros per year.
- An investment premium to encourage climate protection projects is planned, as is one billion euros to promote the development of start-ups.
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