According to a survey by the DIHK, property tax rates in Germany are rising the highest in North Rhine-Westphalia and Saxony.

According to a survey by the DIHK, property tax rates in Germany are rising the highest in North Rhine-Westphalia and Saxony.

A current survey by the German Chamber of Commerce and Industry (DIHK) has shown that one in seven municipalities in Germany increased the assessment rate for property tax this year. The federal states of North Rhine-Westphalia and Saxony are particularly affected, where the rates are highest on average. On a national average, the trade tax assessment rates remained unchanged, while the assessment rate for property tax B rose from an average of 549 percent in the previous year to 554 percent. This increase primarily affects smaller municipalities that have to close their coverage gaps through additional income. Property tax is an important source of income for cities and municipalities and is sometimes used to restructure budgets.

According to a survey by the DIHK, Saxony-Anhalt, Saxony and Thuringia were also examined. In Saxony-Anhalt, the assessment rates for trade and property tax remain almost unchanged, with the exception of the city of Burg, where the assessment rate for trade tax rose from 380 percent to 389 percent and the assessment rate for property tax B was increased from 380 to 424 percent. In Saxony, however, the municipality of Reichenbach in Vogtland has increased the assessment rates for both trade tax and property tax. The Free State already levies high taxes nationwide. In Thuringia, 36 municipalities increased the assessment rate for one or more types of real tax in the first half of 2023. In particular, the trade tax was increased in 26 municipalities, which means higher taxes on profits for traders and provides the municipalities with higher income.

This increase in the assessment rates for property tax and trade tax can have an impact on both the real estate market and the financial sector. High assessment rates can place a financial burden on property owners and, if costs rise, may lead to falling demand on the property market. In addition, higher tax burdens for companies can lead to increased costs and thus a lower willingness to invest. This could have a negative impact on the economy and financial situation of the affected communities.

Source: According to a report by www.mdr.de