500 billion euros for new paths: focus on infrastructure and climate protection!

500 billion euros for new paths: focus on infrastructure and climate protection!

The federal government has presented an ambitious plan to modernize Germany's infrastructure and promote climate neutrality. With a special fund of 500 billion euros, significant investments are to be made in various areas by 2045. This project was approved on March 18, 2025 through an amendment to the Basic Law in the German Bundestag and later by the Bundesrat on March 21, 2025. The implementation takes place in close cooperation with Alliance 90/The Greens and aims to develop the infrastructure sustainably and achieve the climate goals.

The planned funds are planned for the next twelve years and are intended to address not only the transport infrastructure, but also the health sector, digitalization and civil and civil protection. Deutsche Bahn plays a central role in this, having announced an investment requirement of 148 billion euros from the special fund. In addition, the exploratory discussions are aimed at hospital reform, which could also benefit from this fund. In the education sector, funds are also earmarked for digitalization and the construction of new school buildings.

Financial relief measures

In order to provide the necessary funds for infrastructure modernization, the federal government is relying on a combination of tax relief and investment incentives. From 2025 to 2027, a declining depreciation rate of 30% will be introduced on equipment investments. From 2028, corporate tax is to be gradually reduced by 5 percentage points. The income tax for small and medium incomes should also be reduced by the middle of the legislative period.

For commuters, the flat rate will be increased to 38 cents from the first kilometer from January 1, 2026, while the sales tax on food in restaurants will be reduced to 7%. The federal government also plans to reduce energy costs by at least 5 cents per kilowatt hour as well as abolish the gas storage levy and reduce network fees. In this way, those responsible want to relieve both consumers and companies in a timely manner.

Reducing bureaucracy and digitalization

Another important aspect of the plan is reducing bureaucracy. From 2025, an immediate program to reduce rules and documentation requirements is to be implemented in order to reduce bureaucratic costs for the economy by around 16 billion euros. In addition, a central ministry will be entrusted with digitalization in order to improve digital administrative services. The introduction of a citizen account and a digital identity is intended to make it easier for every citizen to access these services.

The plans for setting up a digital company, which should be implemented within 24 hours, are particularly exciting. A digital mobility offer, which includes, among other things, the Deutschlandticket, will also be continued. This will significantly advance the digital transformation in Germany.

Financial stability and control

All of the measures mentioned are subject to funding restrictions. From 2025, the federal government will review its spending and plans to reduce administrative spending by 9% and federal administration positions by 8% by 2029. This is intended to ensure long-term financial stability.

The funds from the 500 billion euro special fund are to be understood as additional investments that exceed the investment quota in the federal budget by more than 10% of the expenditure without the special fund. This regulation ensures that the special fund is used specifically to improve the infrastructure and brings the greatest possible benefit to society. Representatives of the municipalities are demanding that a significant part of the 100 billion euros that flow to the states go directly to the municipalities in order to implement the projects locally.

The exact modalities and specific use of the funds will be regulated by a future federal law. Corresponding coalition agreements could provide further insights into the design of the planned measures. The development of an AI offensive and the strengthening of the European Space Agency are also part of the Federal Government's ambitious program.

For further information, interested readers can view the detailed reports on the federal government and Noerr websites: federalgovernment.de and noerr.com.