Germany implements 32 billion euro Tax reductions to foster economic prosperity

Posted on September 11, 2023   |  

Germany's coalition has reached an agreement on a 32 billion euro ($34.63 billion) corporate tax cut plan spanning 4 years to stimulate economic growth.

A recent attempt to pass the "Growth Opportunities Law" failed, exposing challenges within the partnership comprising 2 socially-minded leftist parties and one economically liberal party.

Public dissatisfaction with the coalition's performance is mounting, with a Forsa poll revealing that 61% of respondents are disheartened by ongoing disputes within the coalition, leading to reduced attention to policy matters.

Chancellor Scholz's leadership approval has also dipped, with 63% perceiving him as a weak leader, compared to 51% in April.

Germany plans to substantially increase subsidies to 67.1 billion euros in 2024, with a substantial portion earmarked to support the transition to a greener, lower-carbon economy.

The newly enacted law incentivizes companies to invest in eco-friendly initiatives, offers tax incentives for research, and enables businesses to neutralize more losses against profits from different financial years.