Germany is facing economic challenges: rising taxes and a decline in growth are casting their shadows
According to the German Ministry of Finance’s monthly report, Germany saw a slight increase in tax revenue in the first half of 2023 compared to the same period in 2022. Tax revenue in this period amounted to 168.6 billion euros (more than 189 billion dollars), an increase of 2.4% over the previous year.
In addition, about €17 billion in other revenue was collected, including interest earnings and premiums from the EU Solidarity Fund following the devastating floods in Germany last year.
In another context, German federal spending rose by 0.6 percent in the first half of the year, due to specific effects, such as the 6.3 billion dollar loan to the International Monetary Fund as investment spending, according to the German budget law.
In relation to the COVID-19 pandemic, government spending declined compared to the first half of last year.
The rise of taxes in Germany
In total, the German federal budget registered a deficit of $47.8 billion in the first half of the year. However, it is important to note that the figures may fluctuate throughout the fiscal year, making it difficult to draw any conclusions about the annual financial data at this time.
However, the German economy, the largest in Europe, showed some resilience in the early months of this year, as it was able to weather the effects of the energy crisis, thanks to massive aid, increased use of liquefied natural gas, and lower gas prices.
In another context, Robert Habeck, the German Minister of Economy, expressed the importance of the European Union concluding a free trade agreement with India, but he also pointed out that he expects complex negotiations.
You can also read more about the tax rate in Germany for the average income in Germany.
During his visit to New Delhi, Habeck explained that the agreement with India is considered one of the most difficult free trade agreements, due to India’s tradition of protecting its market, which requires overcoming these challenges, while India is asking Europe to facilitate the entry of patents and facilitate the passage to its market.
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