Minister-President Reiner Haseloff Praises Investment Package Agreement with the Federal Government
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Yo, listen up!
Saxony-Anhalt's man, Reiner Haseloff, the CDU politician, is stoked about the agreement with the federal government to finance the planned investment acceleration program. "I'm absolutely grateful to the federal government for covering municipalities' loss of revenue until 2029 and even taking a chunk of the states' loss of revenue," Haseloff said. It's about time we take urgent action to boost private and public investments in ol' Germany.
Boosting Municipalities and States
The draft law to kickstart Germany's economic growth is all about offering tax relief for companies, but it'll also cost the federal government, states, and municipalities a pretty penny. After some intense negotiations, the feds and state governments came to an agreement to make it right, especially for the municipalities.
The feds are gearing up to fully cover municipalities' loss of revenue from 2025 to 2029 through adjusting VAT fixed amounts. Plus, they plan to shoulder a portion of the states' loss of revenue proportionally. The feds are looking to put up an extra eight billion euros from 2026 to 2029 for this purpose.
Cash for Education, Care, and Health
Money will be flowing towards the educational and care infrastructure, university modernization, and a transformation fund for hospitals. The distribution will follow the Köthen key. Saxony-Anhalt can expect a steady share for its own investment projects. Haseloff added, "We're moving Germany forward together again."
- Reiner Haseloff
- Investment Package
- Finance
- Saxony-Anhalt
- Germany
- CDU
- Location Germany
Now, let me break it down for you. The German investment package is about a major fiscal boost aimed at supporting economic growth and infrastructure development. It's estimated that the investment will surge to about €115.7 billion in 2025 and rise further to €123.6 billion in 2026, up from €74.5 billion in 2024[3].
The package includes direct compensation to municipalities and states to ensure they can handle the increased investment load. The framework indicates increased fiscal transfers and support mechanisms for local and regional governments[2][3]. A key focus of the investment package is directed towards social infrastructure, particularly in the sectors of education, care, and health. The government aims to modernize and expand capacities in these areas to meet growing demand and enhance service quality[2][3].
The investment package also incorporates a tax incentive program for companies, including a declining balance depreciation scheme for movable fixed assets. The government aims to create a reliable investment climate for businesses, while also planning a gradual reduction of the corporate tax rate from 15% to 10% by 2032[1].
So, there ya go! Germany's 2025 investment package involves substantial funding increases with compensation adapted for municipalities and states, targeting education, care, and health sectors to strengthen social infrastructure alongside corporate tax incentives to drive private investment[1][2][3].
- With the investment package, the discussed sectors in Saxony-Anhalt that stand to benefit from this investment boost include vocational training and education, as the government aims to modernize and expand capacities in these areas.
- In a bid to stimulate business and private investment, the investment package also includes a tax incentive program, which offers tax relief for companies, specifically through a declining balance depreciation scheme for movable fixed assets.
