Schwesig calls for immediate help for tax losses in MV!

Schwesig calls for immediate help for tax losses in MV!

Amid the economic challenges that are currently plaguing Germany, Manuela Schwesig, the Prime Minister of Mecklenburg-Western Pomerania, is demanding financial compensation payments from the federal government ahead of the upcoming Prime Minister's Conference. These are intended to help cushion the threat of tax losses for states and municipalities. Loud Tixio Schwesig recognizes the positive approaches of the federal government's emergency economic stimulus program, but points out that the associated measures also have negative consequences for tax revenue. Municipalities in particular are faced with insoluble challenges that they cannot overcome.

In order to heal the financial wounds, Schwesig is relying on faster depreciation of investments. Marked by a recession, Mecklenburg-Western Pomerania is experiencing remarkable growth, but the consequences of the current economic situation are still evident. The Prime Minister goes even further and calls for a reduction in electricity tax, a reduced VAT rate for the catering industry and an increase in the commuter allowance. These demands are part of a broader concern that your colleagues in other federal states also share.

Collaboration and challenges

The upcoming Prime Minister's Conference on Wednesday is a further step towards a common solution. How South Germans reports, the “investment booster” will play a central role. This could be responsible for over 25 billion euros in reduced tax revenue for states and municipalities by 2029. Prime Minister Hendrik Wüst of North Rhine-Westphalia emphasizes that Germany is now in its third year of recession. There is agreement among heads of government that more stimulus is needed to stimulate the economy.

However, Chancellor Friedrich Merz, who cannot attend in person due to a trip to the USA, met with the Prime Ministers for dinner to discuss the challenges ahead of the conference. Another meeting with Merz is scheduled for June 18th. In this context, the CDU Prime Ministers are calling for adherence to the principle “Whoever orders, pays” in order to establish a permanent mechanism for financial compensation in the event of excess expenditure or reduced revenue due to federal laws.

Concern about finances

The issues of financial situation and possible loss of income are of central importance in the negotiations. Loud daily news Many municipalities see the risk of becoming unable to act if the reduced tax revenue totaling around 46 billion euros comes into force by 2029. Municipalities alone could lose 13.5 billion euros during this period. This is causing great alarm, especially in cities like Bonn, where Mayor Katja Dörner is demanding full compensation for the loss of income.

The financial situation of municipalities is more tense than it has been since the post-war period. With a record deficit of 25 billion euros in 2024, states and municipalities must urgently find solutions in order not to lose citizens' trust in the state. Those responsible know that they cannot overcome the problem alone and are hoping for targeted support from the federal government in order to overcome the financial challenges together.