German taxpayers to receive €300 lump sum for energy costs

After a meeting late on Wednesday evening, the German government managed to agree on a package of relief measures for households struggling with energy costs, including cut-price transport tickets and a one-off energy allowance.

A woman adjusts the thermostat on her radiator.
A woman adjusts the thermostat on her radiator. Photo: picture alliance/dpa | Marcus Brandt

The new measures, which include a one-off €300 energy allowance for workers, should offer quick and unbureaucratic relief for low- and middle-income earners, the government said on Thursday.

When the allowance comes in, all employed persons liable to income tax will be paid a one-time flat-rate energy allowance of €300 as a supplement to their salary.

In their original proposals, the SPD had envisioned this money being paid out via the 2023 tax return, which would have the disadvantage of not reaching consumers’ pockets for another two years.

But the government is working on quicker way to release the money to struggling households via monthly salary payments for employees or a cut in advance tax payments for the self-employed. 

People on social welfare such as unemployment benefits are also set to receive a €200 lump sum this year ahead of a review in the living costs allowance.

In addition to the one-time payouts, the traffic-light coalition is also planning a tax cut on fuel for drivers, improved energy efficiency measures and more relief measures for middle- and low-income families.

It will also introduce the SPD’s plans for a ‘child bonus’ on €100 per child, similar to the one introduced during the height of the Covid crisis. 

READ ALSO: Key points – Germany’s proposals for future energy relief

Public transport ticket

There are also plans to slash prices on public transport with a 90-day ticket for just €9 in an attempt to encourage financially burdened car drivers to switch to greener transport options. 

“Taking the bus and train will probably never have been cheaper in Germany,” said Green party co-leader Ricarda Lang. 

The traffic-light coalition of the SPD, Greens and FDP had met at 9pm on Wednesday to thrash out a package of measures that each of the parties would be happy with.

Many of the measures were hotly debated within the cabinet.

One of the most controversial plans – a proposal for a petrol rebate put forward by Finance Minister Christian Lindner (FPD) – didn’t make it into the finalised package. 

Announcing the measures on Thursday morning, the coalition promised that the “middle” of society would be relieved efficiently and in a socially just manner.

FDP leader Christian Lindner said the agreement of the coalition leaders was proof of the government’s ability to take decisive action. 

“The coalition is convinced that we have to protect the people and the economy in the face of these enormous price increases in the short term and for a limited period of time,” he said.

The coalition had agreed on a first relief package in February before the outbreak of the Ukraine war.

Among other things, it provided for the abolition of the Renewable Energy Act (EEG) surcharge, worth billions, on electricity bills from July.

Previously, this was planned for the beginning of 2023. The package also included an increase in the commuter allowance for long-distance commuters.

READ ALSO: EXPLAINED: What Germany’s relief package against rising prices means for you

Member comments

  1. Not sure I am a fan of constantly using tax payer money to support flawed policies. In the end the message is don’t work too hard and earn more as the government will just take it from you and pass it along to others. How about reducing the size of government in Germany, it has to have the most tax payer representatives per capita of any developed country.

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Norway and Germany seek Nato-led cooperation for key undersea structures

Germany and Norway want to start a NATO-led alliance to protect critical underwater infrastructure, their leaders said on Wednesday, weeks after explosions hit two key gas pipelines in the fallout from the war in Ukraine.

Norway and Germany seek Nato-led cooperation for key undersea structures

 “We are in the process of asking the NATO Secretary General to set up a coordination office for the protection of underwater infrastructure,” German Chancellor Olaf Scholz told a press conference in Berlin.

“We take the protection of our critical infrastructure very seriously and nobody should believe that attacks will remain without consequences,” he said.

Norwegian Prime Minister Jonas Gahr Store said the alliance would be “an informal initiative to exchange between civilian and also military actors” with NATO providing “a centre, a coordination point”.

Underwater cables and pipelines were “arteries of the modern economy” and it was necessary to create “a coordinated joint effort to ensure security for this infrastructure”, he said.

Scholz said he and Store would propose the plan to NATO Secretary General Jens Stoltenberg, who is due in Berlin for a security conference. The Nord Stream 1 and 2 gas pipelines off the Danish island of Bornholm were targeted by two huge explosions at the end of September.

The pipelines, which connect Russia to Germany, had been at the centre of geopolitical tensions as Moscow cut gas supplies to Europe in suspected
retaliation to Western sanctions over the invasion of Ukraine.

Although they were not in operation when the leaks occurred, they both still contained gas which spewed up through the water and into the atmosphere.

Russia and Western countries, particularly the United States, have traded bitter barbs over who is responsible for the blasts.

Several European countries have since taken steps to increase security around critical infrastructure. 

The G7 interior ministers warned earlier this month at a meeting in Germany that the Nord Stream explosions had highlighted “the need to better protect our critical infrastructure”.

Norway has become Europe’s main gas supplier in the wake of the war in Ukraine, taking the place of Russia.

The Scandinavian country has a vast network of pipelines, stretching for almost 9,000 kilometres, linking it to the continent, which experts have said are at risk of sabotage.