Federal government takes over billions in tax losses – agreement in Berlin!
Lower Saxony ensures financial stability: the federal government covers tax losses and invests in education and health until 2029.

Federal government takes over billions in tax losses – agreement in Berlin!
What is currently affecting the financial landscape in Germany? A central issue is the massive tax losses, which place a heavy burden on the federal and state governments. Today, on June 24, 2025, Lower Saxony's Prime Minister Olaf Lies (SPD) announced that the federal and state governments have agreed on a cost sharing. This came after a meeting of the federal-state working group in Berlin, where the details were discussed. The federal government has agreed to cover large parts of the expected tax losses. Loud NDR The investment package that is to be approved in the Bundestag will play a decisive role.
The financial impact is enormous: total tax losses of around 48 billion euros are expected. Of this, 16.6 billion euros fall on the states, 13.5 billion euros on the municipalities and 18.3 billion euros on the federal government. The municipalities in Lower Saxony in particular were relieved about the full compensation for their trade tax losses, which could send a positive signal for economic stability.
Investment program with far-reaching consequences
A crucial step towards stabilizing the economy is the introduction of an immediate tax investment program. The Federal Cabinet has already passed a corresponding law to put Germany on a growth path. The Federal Ministry of Finance emphasizes that so-called tax law changes are intended to create incentives for investment decisions. These measures could help secure jobs and strengthen competitiveness.
Several key changes are planned through 2028 as part of the Investment Booster program, including:
- Abschreibungen von 30% für bewegliche Wirtschaftsgüter, die ab dem 1. Juli 2025 getätigt werden.
- Schrittweise Absenkung der Körperschaftsteuer auf 10%, beginnend ab 2028.
- Förderung von Elektrofahrzeugen durch degressive Abschreibungen mit einem hohen Startsatz von 75%.
- Erhöhung der Bemessungsgrundlage für steuerliche Forschungszulagen von 10 Millionen Euro auf 12 Millionen Euro.
Foundation for sustainable development
The agreement between the federal and state governments was also noted by Sebastian Lechner, chairman of the Lower Saxony CDU state parliamentary group. He demands that the new funds be used primarily to promote investment and not to relieve the burden on the state budget. There is also a desire for an additional million annually for the municipalities in Lower Saxony. ZDF reports that despite this agreement, the countries face a challenging economic situation as the exact modalities of compensation still need to be worked out.
Prime Minister Lies sees the agreement as an important step for the stability of Lower Saxony's economy and announced that a total of 8 billion euros will flow into educational institutions, daycare centers and hospitals from 2026 to 2029. In the coming weeks it will be exciting to see how the discussions about investments develop and what specific aid measures will be taken.
The upcoming Bundestag votes will determine the success of the program and are essential to create future-proof framework conditions for the regional economy.