Tax Cuts Under the German Budget 2017
Persons who are liable to taxation in Germany have good news in this sense, as the German government announced several tax cuts under the 2017 Budget. The total value of the tax cuts which will become applicable in 2017 (and also in 2018) is estimated at EUR 6 billion. Our law firm in Germany can offer more details on how the new tax cuts will become applicable to natural persons and legal entities taxed in this country. At the moment, the main political parties in Germany have reached an agreement on the taxes which were taken into account for this operation.
German taxation in 2017
The level of taxation in Germany will be reduced to a moderate level. The decision was taken as an effect of the wage inflation. The tax level applicable at the moment has as a main effect a lower net income for various categories of persons, so the measure was necessary to increase the general income.
Those who have a company in Germany should know that the new Budget will have positive effects on their businesses, as the payroll taxes will be reduced starting with 2017.
One of the main intentions of the German authorities is to reduce the gross debt by 11% in 2017 compared to the current situation. The federal government issuance will be reduced in 2017 to EUR 185,2 billion, in comparison with the estimated value of EUR 207,2 billion, expected at the end of 2016.
Our German law firm can assist with more information on the taxes imposed in Germany.
Germany is a stable and powerful economy, and this can be seen in the fact that the unemployment rate reached a historic low value, the lowest registered in the last 25 years, due to the measures taken to meet the needs of the workforce market.
Current taxation level in Germany
The income taxes applicable to natural persons living in Germany are currently imposed on a progressive basis. That is, persons can be taxed on their income on a rate which varies from 14% to 45%.
At the moment, the corporate tax rate imposed here is of 15%, but calculated with other compulsory taxes, such as the trade tax or the solidary tax, the overall value of the rate can increase up to 30%- 33%.
We invite those who are interested on this subject to contact our attorneys in Germany for more details on the German tax system.