Editions:  Austria · Denmark · France · Germany · Italy · Norway · Spain · Sweden · Switzerland

Government approves €8.5-bln fiscal package

Share this article

Government approves €8.5-bln fiscal package
Photo: DPA
18:24 CET+01:00
The German government on Monday adopted a package of fiscal measures worth €8.5 billion ($12.7 billion) including tax cuts and benefits aimed at underpinning economic growth.

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.

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

Get notified about breaking news on The Local

Share this article

The Local is not responsible for content posted by users.
Become a Member or sign-in to leave a comment.

From our sponsors

The French business school helping students craft more meaningful careers

Two MBA graduates from EMLYON Business School explain how their studies helped them to land their dream jobs working for international organisations.