The draft coalition agreement of the new German government coalition also provides for different tax measures on its 178 pages.
We have summarized the key proposed measures hereafter for you.
The main tax changes are:
- In 2022 and 2023, deduct a proportion of the acquisition and production costs of the fixed assets purchased or manufactured in the respective year, which serve climate protection in a special way, from the tax profit (“super depreciation“).
- Prolong the extended loss offsetting provisions until the end of 2023 and extend the loss carry-carryback to the two immediately preceding assessment periods.
- Extend notification requirements for cross-border tax arrangements to national tax arrangements of companies with a turnover of more than EUR 10 million.
- Extend withholding taxation, in particular by adapting double taxation treaties; Supplement the interest barrier with an interest rate barrier.
Further tax changes are to be mentioned here are:
- Align existing improvements in plug-in hybrid vehicles with company car taxation for newly registered vehicles more on purely electric run vehicles;
- After 2025, the flat-rate tax for emission-free vehicles (electric) will be 0.5 percent.
- Extend the tax regulation of the home office for employees until December 31, 2022.
- Increase the apprenticeship allowance (“Ausbildung”) from EUR 924 to EUR 1,200.
- Increase the Capital income lump sum tax free amount as of January 1, 2023 to EUR 1,000.
- Make employee equity participation more attractive.
- More flexible structuring of the real estate transfer tax for federal states (e.g. through a tax exemption) in order to facilitate the acquisition of owner-occupied residential property.
- Modernize and accelerate tax audits in the area of corporate taxation; improved interfaces, standardization and sensible use of new technologies.
These are necessary and sensible changes in the light of the corona pandemic. On the basis of the present draft, however, there can be no talk of a comprehensive reform. It is to be hoped that the new governing parties will contribute to the absolutely necessary dismantling of the tax bureaucracy and the creation of competitive tax law, as this is also linked to the success of Germany as a business and investment location.
We will continue to follow the development closely and inform you about it here.