Uncertainty Looms Over 2025 Child Benefit Increase

The anticipated increase in child benefits and tax relief, planned for 2025, faces significant uncertainty. Finance Minister Jörg Kukies has indicated that these measures cannot be finalized this year due to time constraints. The departure of the traffic light coalition has left the SPD and Greens without a parliamentary majority, placing the decision in the hands of the CDU and FDP. The FDP, however, opposes the current draft due to the additional bureaucratic costs it imposes on businesses.

Kukies has assured that there is no constitutional violation in adhering to the 2025 government draft for interim fiscal management, a practice supported by the finance ministry's recommendations. Yet, without a resolution by the Bundestag and Bundesrat, the proposed changes remain tentative. If passed, the legislation would require retrospective application from the year's start.

The political landscape is further complicated by the upcoming elections, with a new Bundestag expected to be elected by the end of February. This timeline adds pressure to finalize the 2025 budget by mid-year. Meanwhile, families hoping for financial relief may have to wait longer, with IT adjustments for family funds making a payout before Christmas unlikely.

Amid these complexities, the FDP continues to demand modifications to alleviate bureaucratic burdens, while the SPD and Greens lack the leverage to push the legislation through. As the debate unfolds, the prospect of increased child benefits and tax relief remains in limbo, awaiting political consensus and legislative action.