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Break in deliberations in the Federal Council: Fundamental revision required
Photo: Bernd von Jutrczenka / dpa
The Federal Council has blocked tax relief for companies to the tune of seven billion euros per year. A clear majority of the Länder voted on Friday in Berlin to involve the mediation committee of the Bundestag and Bundesrat in the discussion on the so-called Growth Opportunities Act. It is still unclear when this meeting will take place and what a compromise might look like. Several state premiers criticized the fact that two-thirds, or almost 20 billion euros, of the lack of tax revenue would fall on states and municipalities.
According to earlier information from the responsible Finance Committee, the Federal Council is striving for a fundamental revision of the draft law. The Bundestag had approved this on Friday last week with the votes of the traffic light coalition.
Relief for small and medium-sized enterprises of around seven billion euros per year from 2024 and a total of more than 32 billion in the coming years is planned. The measures are intended to give new impetus to the sluggish German economy.
At its core is a premium of 15 percent of the total amount for investments in climate protection measures. However, this premium is less extensive than the "super depreciation" actually provided for in the coalition agreement, which was also intended to spur investment in digitalisation.
Elsewhere, however, companies are now being granted significantly better depreciation options for a limited period of time – both for movable assets and for residential construction. Companies should also be better able to offset losses against profits for them. In addition, tax incentives for research will be expanded.
mik/Reuters