Tax failures: Wüst insists on compensation for an investment program

In the struggle between the federal and state governments by the billion-dollar investment program for the economy, NRW Prime Minister Hendrik Wüst (CDU) increases the pressure on the federal government. In view of the expenses for the federal states and municipalities, Wüst pounds on compensations through the planned federal government tax relief.

The connexuality principle – “who ordered, pays” – is laid down in the coalition agreement between the Union and the SPD, said Wüst in Düsseldorf. It must now also be used for the first time. “We don’t swim like the fat on the soup,” said the CDU politician.

“Of course we are approaching the federal government with the claim of a complete compensation,” said Wüst with a view to the top meeting of the Prime Minister with Chancellor Friedrich Merz (CDU) on Wednesday. In the end, a compensation is also 90 percent possible if there was a reliable and permanent regulation.

Come on or mediate committee

Nevertheless, Wüst was optimistic that you would get one step further at the meeting with Merz. “I am good courage.” If an agreement was to be reached by the Federal Council meeting on July 11th, the law must now move forward. “Otherwise it ends up in the mediation committee.”

At the same time, Wüst praised the investment program planned by Federal Minister of Finance Lars Klingbeil (SPD). “Germany needs growth,” said the CDU politician. “We are in the third year of recession.” So far there have been no three recession years in a row in Germany – neither during the oil crises nor in corona pandemic. New growth impulses are also necessary to secure jobs.

Among other things, the Federal Government plans better tax depreciation for companies for purchases. Afterwards, the corporation tax is to be gradually reduced to 10 percent in 2032. The income losses accepted would have to be disproportionately wearing the municipalities.

Billions of losses for countries and municipalities

According to calculations from the district, the federal, state and municipalities are taking over almost 50 billion euros less taxes due to calculations from the district. According to Wüsts, the countries and municipalities would have to bear around 30 billion euros by 2029. The NRW state budget alone would be charged with 3.7 billion euros by 2029 without compensation. Around three billion euros in failures would also be added to the municipalities. The households of the federal states and municipalities in the third year of recession should “not be completely brought out of balance by the investment package,” said the head of government.

Wüst demands hurry in the case of old debt solution

Wüst also called for a quick implementation of the special fund of 500 billion euros. So far, it is planned that the countries receive a fifth, i.e. 100 billion euros. At the same time, the Federal Government must submit a draft law to reduce municipal debts before the summer break. Because if the old debt problem is not solved, many municipalities could not invest.

Especially before the NRW municipal elections on September 14th, there must be binding regulations, said Wüst. Despite the difficult financial situation, the state of North Rhine -Westphalia had already made many billions of euros available for debt reduction. Now the federal government is on the train.

“Everything will only work if you get out of this overwhelming debt burden beforehand,” said Wüst. At the same time, he warned the federal government: “Neither the special fund for investments nor the debt scope for the federal states had ever had an appointment as a counter -business for approval for the immediate program.”

Municipalities warn federal government of word breakage

The municipal umbrella organizations of North Rhine -Westphalia also demanded compensation from the federal government for tax failures. “Anyone who opens tax cuts must also have the tax defaults themselves,” said the associations. “The federal government’s planned investment booster becomes the first lacquer test for how serious it is with the coalition agreement.”

The municipalities warned indirect financing of the tax reform from the municipal funds of the special fund for infrastructure and climate neutrality. In view of the existing financial shortage, a real compensation for the municipalities is urgently required.