Bad mood: Bad Wurzach is struggling with a dramatic financial deficit!

Bad mood: Bad Wurzach is struggling with a dramatic financial deficit!

In Bad Wurzach, a worrying financial report is causing a bad mood in the economy. Stefan Kunz presented the results for the first quarter of 2025 at the local council meeting, which indicate significant losses of income. In particular, the decline in trade tax revenue by over 30% compared to the previous year is alarming. The budget estimate for trade tax for 2024 is around 12.8 million euros, while only 8 million euros are planned for 2025. Currently, however, people are slightly over this approach. Swabian reports that the final financial situation over the course of the year, especially in the second quarter, is still uncertain.

The current May tax estimate has reduced projected economic growth for 2023 from 1.1% to 0% and for 2024 from 1.6% to 1.0%. The financing deficit in municipal budgets is estimated at 24.8 billion euros for 2024, which is the highest deficit since reunification. Against this background, it is emphasized that savings in current expenditure are unavoidable.

The role of trade tax

The trade tax is a crucial source of income not only for Bad Wurzach, but for many municipalities. According to the Chamber of Commerce and Industry (IHK), this tax is particularly vulnerable in difficult economic times as revenue falls while social spending increases. In Heidelberg, trade tax revenue accounted for around 19% of the ordinary result in 2023, while in Mannheim it was 24.6%. Here too, forecasts for 2024 are worrying: Mannheim expects the ordinary result to fall to 28.6 million euros – 43.9 million euros less than originally assumed. In addition, a deficit of 18 million euros is forecast for Mannheim from 2025. The IHK explains that excessive dependence on trade tax endangers the financial stability of cities.

Rising costs for investments and disproportionately growing expenditure by municipalities are making the situation even worse. A lack of reserves contributes to the financial burden. Political decisions, such as the potential increase in trade tax rates, could also further impact the attractiveness of the location. While Mannheim has ruled out tax increases for 2024, Heidelberg is discussing alternative measures such as a packaging tax.

In view of these challenges, IHK President Manfred warned against further tax increases and called for business-friendly measures to sustainably stabilize municipal budgets. The ongoing decline in trade tax revenue shows that municipalities urgently need to look for solutions to get the dire financial situation under control.