The federal government and the states have reached a consensus on an ambitious investment package aimed at invigorating the economy. Central to this agreement are tax incentives designed to benefit businesses, particularly through enhanced depreciation options for machinery and electric vehicles.
These measures are set to take effect from 2028, alongside a reduction in corporate tax rates, offering significant financial relief to companies. The package acknowledges the potential revenue shortfalls for municipalities and promises financial compensation to balance these losses.
This fiscal cushioning will ensure that both federal and state governments, as well as local municipalities, can continue to function effectively despite the decrease in tax revenue. The states have committed to endorsing the legislation in the Bundesrat by July 11, marking a crucial step in the implementation process.
This collaboration underscores a concerted effort to stimulate economic growth while addressing the financial concerns of various government tiers. As details emerge, the investment package is poised to become a significant element of economic policy, promoting sustainable growth and innovation in the coming years.
