Hesse breaks property tax record: 60% of municipalities increase significantly!

Hesse breaks property tax record: 60% of municipalities increase significantly!

The new property tax law came into force in Hesse on January 1, 2025. This meant that the Hessian municipalities had to redefine their property tax assessment rates. The aim of the reform was to keep property tax revenue at the same level, which is referred to as revenue-neutral. Nevertheless, a current survey by the Hessian Chambers of Industry and Commerce among 421 municipalities shows that less than a third, precisely 131 municipalities, complied with the recommended assessment rate. This is particularly noticeable in northern Hesse, where no municipality in the Schwalm-Eder district has set the recommended assessment rate.

The Hesse Taxpayers' Association has also found that around 60% of municipalities have increased taxes by at least five percentage points. The recommended lifting rate is 432 points, while the actual Hesse-wide average is 476 points, which is approximately 10% above the recommended value. This means that around two thirds of Hessian municipalities will demand higher property taxes from 2025 than in the previous year.

Financial burdens and challenges for municipalities

The financial situation of many municipalities in Hesse is tense. 80% of municipalities had a budget deficit last year. The high property taxes not only burden private owners, but also companies, which are at risk from rising costs and stagnating domestic demand. Despite the increased assessment rates, the individual property tax payable for some owners may have decreased because each property has been revalued.

The owners have already received property tax notices with the new property tax amounts. These taxes are levied on property and leasehold building rights and can be passed on to the tenants. An important background is the decision of the Federal Constitutional Court to redefine the outdated standard values; these are now referred to as measurement amounts.

Monitoring of the assessment rates

A tax rate monitor is available to citizens and companies and can be viewed on the website of the Hessian Chambers of Industry and Commerce. The current situation shows that the communities in Hesse are facing major challenges. Many appear to have reached the limits of their financial flexibility, which could potentially lead to further tax increases.

For further details and information, the documents from the Hessian tax administration on the subject of assessment rate recommendations can be found at here be retrieved. More about the general developments in Hesse reported fr.de.