Klingbeil's tax package: Billion boost for Thuringia's economy!

Klingbeil's tax package: Billion boost for Thuringia's economy!

In the coalition agreement, the Union and the SPD gave Finance Minister Lars Klingbeil (SPD) a clear mandate: a new boost for the economy. On June 3, 2025, Klingbeil will present a bill that provides billions in tax relief. The aim of these measures is to relieve the burden on companies and promote investments in order to improve the economic situation in Germany. The focus is particularly on an investment booster that will enable companies to deduct 30% of their investments in new machines from tax from 2025 to 2027. This could be particularly important for medium-sized businesses.

Christoph Ahlhaus, managing director of the Federal Association of Medium-Sized Businesses, welcomes the plans. However, he points out that not all companies can benefit from the tax relief, as only around 50% of medium-sized entrepreneurs have the necessary funds for investments. Ahlhaus also calls for sustainable tax cuts and criticizes the fact that the planned reduction in corporate tax from 2028 is viewed as too late.

Challenges for the economy

Despite positive reactions, there are also skeptical voices about the measures. Reint Gropp, President of the Institute for Economic Research in Halle, expresses concerns. He cites other obstacles to investment such as geopolitical uncertainties, tariffs, high energy prices, additional wage costs, bureaucracy and labor shortages as more important factors that are affecting the German economy.

However, the tax relief will not be without consequences for the state budget. According to the calculations, the state will have to expect a loss of revenue totaling 46 billion euros between 2025 and 2029. This regulation will have consequences particularly for federal states such as Thuringia; The Free State expects a reduction in revenue of over 520 million euros in the same period. The Finance Minister of Thuringia, Katja Wolf, warns that the federal government should bear the costs of the tax relief in order to mitigate the financial challenges for states and municipalities.

The federal government will deal with Klingbeil's bill next day. The approval of the Bundestag and Bundesrat is required in order for the planned tax relief to come into force. In the current political debate it is clear that the future design of economic policy will have far-reaching implications for companies and public finances.

MDR reports that the planned measures are generating both support and skepticism. While the focus is on financial relief and promoting investments, numerous challenges remain. Mirror adds that the general economic situation and specific barriers could also be crucial to the success of the tax relief.