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Government approves €8.5-bln fiscal package

AFP · 9 Nov 2009, 18:24

Published: 09 Nov 2009 18:24 GMT+01:00

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The new centre-right coalition formed last month adopted an "accelerated growth law" that is expected to be quickly by parliament.

The bill includes a lowering of value-added tax (VAT) in hotels and restaurants to 7.0 percent, a reform of business inheritance laws and some cuts in corporate taxes.

Companies will be the main beneficiaries but families will also receive an additional €20 per month for each child.

The measures are expected to take effect on January 1, and constitute "positive long-term support for growth," a Finance Ministry statement said. German authorities have decided to allow the national deficit to grow as they try to get Europe's biggest economy back on track towards sustainable growth.

Chancellor Angela Merkel's new cabinet has also said it would reform the tax system and cut taxes by €24 billion starting in 2011, but a spokesman for Merkel was more reserved on that question.

Story continues below…

"We will focus initially on putting the first part into action," the spokesman said, before looking at further reforms in mid 2010.

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Your comments about this article

00:27 November 10, 2009 by Bushdiver
Typical German bullshit. Cuts in Corporate taxes, lowering of Hotel and Resturant VAT and the average citizen with children get a whopping €20,00 per child per month more. I can really see that stimulating the country. As usual, the average person in Germany is taking it up the ass again from the government. I think putting more money into peoples pockets or should I say taking less out of peoples pockets would go alot farther in boosting the economy.
08:25 November 10, 2009 by duckys
i agree with Bushdiver... and also if they wanted to change something... then they should encourage companies to be open longer and also possibliy Sundays....
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