All the fiscal measures of the German government to revive the economy
The German government approves a four-year 32 billion aid plan to revive the economy. The article in the Spanish newspaper El Pais
The coalition government approves the tax package after an initial blockade due to disagreements between environmentalists and liberals – writes El Pais .
Germany is preparing to approve a multibillion-dollar stimulus package. After weeks of clashes within the tripartite government – made up of Social Democrats, Greens and Liberals – over the measures needed to revive the slumping economy, the cabinet on Tuesday reached an agreement on the total amount of the bill: although the initial plan foresees a fiscal package of 6 billion euros a year, the government has agreed a stimulus package of up to 32 billion euros over the next four years, according to a draft consulted by Reuters . An earlier attempt to implement the so-called Growth Opportunities Act failed due to disagreements between the finance minister, the liberal Christian Lindner, and the family minister, the environmentalist Lisa Paus.
"We will discuss how to get a big momentum," said the chancellor, social democrat Olaf Scholz, on Tuesday from Meseberg castle, about 70 kilometers from Berlin, where the government was holding a two-day cabinet meeting to decide on measures to be taken. adopt at the beginning of the new political year. "The German economy can do more," added the head of government. The gross domestic product of the EU's largest economy stagnated in the second quarter of the year , after the recession that dragged on into the winter.
Scholz and his top ministers intend to use the meeting to promote an image of unity that has been lacking in recent months and which has contributed to declining support for coalition parties in polls and the rise of the far-right Alternative for Germany (AfD). The Meseberg meeting, to be held on Tuesday and Wednesday, will mainly focus on the precarious situation of the German economy and on recipes for improving it. "It is very important that in this situation an offensive by the federal government is launched to stimulate growth in our country, to ensure that companies make their own decisions on investment and development opportunities," said the Social Democrat leader .
According to the draft to which Reuters has access, the aid package will lead to a drop in tax revenues of about 7 billion euros in the first year: 2.6 billion for the federal government, 2.5 billion for the federal states and 1, 9 billion for the Municipalities.
The Growth Opportunity Act was due to pass a fortnight ago. After fierce debates within the coalition, the family minister and finance minister reached an agreement on Sunday on a new care allowance for children from vulnerable families, which will provide around €2.4 billion by 2025. Scholz had to intervene in negotiations to get the deal through after the Green Paus blocked Liberal Lindner's proposed tax relief package due to lack of funds for the childcare programme.
"It was a difficult negotiation, but it was worth it," said Paus, joined by Lindner and Social Democrat Labor Minister Hubertus Heil. However, the family minister made it clear that even more funds are needed to completely eradicate child poverty. The Green leader described the new program as the "most comprehensive socio-political reform" in recent years. According to his ministry's estimates, up to 5.6 million families at risk of poverty will receive "faster, easier and more direct" childcare subsidies.
During the coalition negotiations, the family minister had put the need for 12 billion euros on the table, a figure that was gradually reduced to the agreed 2.4 billion. Minister Lindner, for his part, said that the new benefit will be around 400 million euros more than what was foreseen by his ministry, which had offered an additional 2 billion euros from the budget.
The coalition government intends to present the bill in mid-September for debate in the Bundestag, the lower house of the German parliament, with the aim of having it enter into force in January 2025. The two ministers have come under pressure from Chancellor Scholz himself to put the crisis behind them, ahead of a two-day withdrawal by the coalition government, which began on Tuesday, which intends to focus on the government's efforts to revive the ailing German economy.
The industry has been cautiously welcoming Lindner's tax package, with a particular focus on small and medium-sized businesses. One of the main elements is a new climate investment grant mechanism – part of the coalition government's program agreed in 2021 – to help companies accelerate the process of cutting emissions. Most of the 10-measure plan presented by Scholz on Tuesday had already been announced, including the Special Fund for Climate and Transformation worth around €212 billion for the period 2024 to 2027.
(Excerpt from the foreign press review by Epr Comunicazione)
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/tutte-le-misure-fiscali-del-governo-tedesco-per-risollevare-leconomia/ on Sat, 02 Sep 2023 05:20:10 +0000.