Germany expects €126 billion in additional tax revenues
October 27, 2022
Germany's Finance Ministry expects €126.4 billion ($126.7 billion) in higher tax revenues for the German state as a whole in the 2022-2026 period compared with May forecasts, it said in updated projections published on Thursday.
The federal government alone accounts for a surplus of around €47.5 billion.
In 2022, however, the federal government expects a minus of €7.2 billion compared to the last estimate from May. Meanwhile, states can expect to €2.9 billion more, while municipalities will likely see an increase of €5 billion.
High risks for the economy
Finance Minister Christian Lindner said in a statement that despite the upward revisions, "It is also clear: there is no scope for additional expenditures."
"The current estimate results are characterised by a high degree of uncertainty," he added. "The risks for economic development are great, especially with regard to possible bottlenecks in energy supply in the coming months."
Lindner also pointed out that changes to tax law were still in the parliamentary process and were therefore not taken into account in the estimate. This would dampen tax revenues.
Members of coalition government, opposition urge more relief
Members of other parties represented in Chancellor Olaf Scholz's coalition government, along with the opposition, called for the extra tax revenues to be spent on helping the German population amid the ongoing inflation and energy crises.
Sven-Christian Kindler, a member of the environmentalist Green Party in the German Bundestag, said the tax estimate is an "appeal for an active fiscal policy." He said it would be a right move to provide more support for citizens amid the crises and "to invest in a climate-neutral future."
In the opposition, Christian Haase of the conservative Christian Democratic Union (CDU) said the government "should and must provide faster and more comprehensive crisis help for citizens and businesses than previously planned."
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wd, dh/sms (AFP, Reuters)