German federal government plans tax reform to reduce electricity prices for industry

German federal government plans tax reform to reduce electricity prices for industry

The federal government's tax reform is expected to lead to a reduction in the price of electricity for the economy. The plan is to significantly reduce electricity tax for the manufacturing industry and expand electricity price compensation for corporations. This is intended to provide additional relief for 350 companies in particular that face international competition and suffer from high electricity prices. In addition, a subsidy will be made available to partially finance the transmission network costs of up to 5.5 billion euros, which will also have a positive effect on the price of electricity.

According to a report by www.faz.net, these federal government plans are already having a positive impact on the market. Shares in the energy-dependent chemical industry have risen to daily highs due to the federal government's agreement.

Since Germany has a high electricity price compared to other countries, which is particularly burdensome for industry, the planned tax reform is expected to have a number of positive effects. Reducing electricity tax and expanding electricity price compensation will reduce companies' costs and make them more competitive. This could lead to German companies retaining more jobs and curb the exodus of companies due to high electricity prices.

However, there is also criticism of the government's plans, as the planned relief will mainly benefit large, energy-intensive companies. Smaller companies and craft businesses could come away empty-handed, which could lead to further distortion of the market. The impact of the tax reform should therefore be closely monitored and adjusted if necessary to ensure sustainable and equitable development.