Government breaks election promises: electricity tax remains high!

Government breaks election promises: electricity tax remains high!

The federal government is under considerable pressure after failing to keep a key election promise on electricity taxes. Instead of a comprehensive reduction in electricity tax, which was promised in the coalition agreement, the government is only planning targeted subsidies for selected sectors, in particular industry as well as agriculture and forestry, from January 1, 2026. This leads to massive criticism, including from within our own ranks. North Rhine-Westphalia Prime Minister Hendrik Wüst (CDU) expresses concerns that this would be a breach of the coalition agreement. Such a promise was a key economic policy goal of the CDU and CSU.

Originally, a permanent relief of five cents per kilowatt hour was promised. This decision hits companies hard that are suffering from enormous pressure due to locational disadvantages. According to the President of the Chamber of Commerce and Industry (IHK), Reinhold Braun, planning security is essential for energy-intensive industries. Without noticeable relief, there is a risk of competitive disadvantages, production relocations and the loss of qualified jobs.

Criticism and demands from business

Medium-sized businesses in the travel and hospitality industries as well as in the skilled trades are particularly affected. These sectors are already struggling with the consequences of Corona and inflation. Economics Minister Katherina Reiche (CDU) and a spokesman for Chancellor Friedrich Merz (CDU) refer to budget constraints. The government argues that consumers could be relieved elsewhere, for example by abolishing the gas storage levy and reducing network fees. However, a later reduction in electricity tax for consumers cannot be ruled out.

There is great disappointment in the economy. Industry association president Alexander von Preen warns of a loss of trust, which could have negative effects on companies. The Central Association of German Crafts and the German Chamber of Industry and Commerce also express their dissatisfaction with the planned measures, which could increase not only commercial but also private household burdens. Consumer advice centers warn that German households already pay the highest electricity prices in Europe.

Outlook and further tests

Union politicians are calling for comprehensive relief and would like to re-examine the reduction in electricity tax for everyone in the parliamentary process. SPD economic expert Sebastian Roloff rejects allegations that the finance minister has broken his word, but is in favor of re-examining the plans. An EU report also suggests possible annual savings of up to 300 million euros if the uniform wholesale price were replaced by electricity price zones.

These developments are increasingly calling into question the credibility of the federal government in economic policy. Investment-friendly conditions do not appear to be a priority at the moment, while consumptive programs that secure short-term votes are preferred. According to criticism from business, a targeted economic turnaround can hardly be achieved without low energy costs, tax relief and investment security. The future of German industry now increasingly depends on the government's response to these legitimate concerns.