Dispute over financial equalization: Thuringia rejects Söder’s threat

The Thuringian finance minister Katja Wolf (BSW) is against the threat of the Bavarian Prime Minister Markus Söder (CSU), from the financial equalization of the federal states. “A one -sided termination of this solidarity community is not possible under constitutional law,” she told that star. In Article 107, the Basic Law provides an appropriate balance of the different financial strength of the countries.

“So just get out is not possible,” said Wolf. “The Bavarian Prime Minister apparently has the federal financial equalization as a resolution every year as a summer hole topic.”

Bavaria paid almost 6.7 billion euros into the compensation pot in the first half of this year. According to Söder, these are almost two billion euros more than in the comparison period of the previous year. The prime minister therefore questioned the system again. “If there is no agreement with countries, this financial equalization – unfortunately only at the end of the decade – will definitely be terminated,” he said. “We don’t participate anymore.” The mechanism reward instead of performance.

Finance Minister Wolf, who is also President of Vice in Thuringia, considers Bavaria to be unjustified. “The Bavarian share of the redistribution mass was 2.13 percent in 2021 and sank to 2.04 percent by 2024,” she said. “This means that Bavaria’s increasing burden in the financial equalization cannot generally be determined.”

According to Wolf, the fact that the proportion has increased to 2.68 percent this year is due to the currently particularly high income of Bavaria in the area of inheritance tax. “This ‘special case’ is almost the entire additional amount in the current year,” she said.

Thuringia is one of the largest recipient countries in Berlin and Saxony. It received 1.161 billion euros from the system in the first half of the year alone.

The finance minister defended the compensation mechanism. “The financial equalization prevents economic and social division between financially strong and financially weak regions,” she said. The amount of the payments reflects the historically, geographical and settlement -structured differences in tax power.

The former Federal Constitutional judge Peter Huber partially contradicted Wolf. “It is true that a single country does not have a veto law against the ‘whether’ of the financial equalization,” he told that star. “The financial equalization is laid down in the Basic Law.”

However, Bayern, together with at least two other countries, can terminate the legislative regulation that has been in force since 2020. “This exit option is available,” said Huber. “The only question would be which new compensation system of the federal legislature would then issue.”

According to Article 143d of the Basic Law, the Financial Equipment Act will be in the current version “if the Federal Government, the Bundestag, the Bundestag or at least three countries have requested negotiations on a reorganization of the federal financial relationships and with the end of five years after notification […] no legal reorganization […] came into force.

Bavaria already filed a lawsuit against the current financial equalization at the Federal Constitutional Court in 2023. The twelve reciprocal countries-in addition to Bavaria, also include Baden-Württemberg, Hesse and Hamburg-have come together to form a process community.

Constitutional lawyers rate the success of the lawsuit as low. Nevertheless, Bayern sticks to it. “We stay with it: we continue to complain,” said Söder.