Federal government launches location funding law: money for start-ups and the environment!

Federal government launches location funding law: money for start-ups and the environment!

The federal government has taken a decisive step to strengthen Germany as a financial location. With the draft bill for a location support law (StoFöG) published today, the Federal Ministry of Finance (BMF) would like to stimulate private investments and at the same time improve the framework conditions for companies. The law is part of an extensive emergency program that was passed by the government on May 28, 2025. The aim is to increase economic growth through investment offensives and structural reforms. The focus is on innovation, sustainability and reducing bureaucracy der-betrieb.de reported.

A central element of the law is to improve financing conditions for companies. Small companies and start-ups in particular should benefit from the new regulations. This also includes the promotion of fund investments in renewable energies and infrastructure, which is intended to support the sustainable restructuring of the economy.

Tax relief measures

An important aspect of the draft includes adjustments to tax law. Among other things, the law provides for the improvement of the transfer of profits from the sale of shares in corporations in the Income Tax Act. In addition, an increase in the reinvestment reserve from 500,000 euros to 2,000,000 euros is planned in order to give companies greater scope for operational reinvestments. These adjustments are part of efforts to increase the competitiveness of the financial center and promote private investment.

Cutting bureaucracy and regulatory reforms

The law also provides for a clear reduction in bureaucracy. Care is taken to ensure that the level of consumer protection is not lowered. The Federal Financial Supervisory Authority (BaFin) is to be streamlined in its supervisory activities in order to increase efficiency. At the same time, the aim is to implement EU capital market legislation in a location-friendly manner, including the Listing Act and the ESAP.

In addition to these measures, the Federal Ministry also plans to expand the investment opportunities of funds. This applies, among other things, to the possibility of unlimited investments in commercial partnerships and other funds such as the European Long Term Investment Funds (ELTIF). Furthermore, income from investment funds from renewable energy and infrastructure projects will be subject to taxation in the future, which will abolish the previous tax exemptions.

In summary, it can be said that the Location Promotion Act represents a comprehensive concept for strengthening Germany's financial center. When implementing the measures, it will be crucial to find the balance between regulation and support in order to successfully achieve the objectives of the law. Loud nwb.de The law is intended to help stabilize the economy and create sustainable structures.