© Reuters. German Economic Affairs and Climate Action Minister Robert Habeck speaks during a session of the lower house of parliament, the Bundestag, in Berlin, Germany February 1, 2024. REUTERS/Liesa Johannssen/File Photo
FRANKFURT (Reuters) – German Economy Minister Robert Habeck has floated the idea of a reform of the country’s corporate taxes as one way to take pressure off companies that are facing numerous challenges, including high energy costs.
“I also see that we have an overall corporate taxation that is no longer competitive and conducive to investment,” Habeck told weekly Welt am Sonntag.
“This is precisely why we should consider how we can, for example, finance tax relief, tax incentives for investments in the future,” he said, adding that would be a way to unleash economic forces.
Habeck said that the government was constrained by what he called “extremely tight financial leeway”, pointing to savings pressure with regard to Germany’s 2025 budget.
His comments come after Finance Minister Christian Lindner called for a package of measures to strengthen the economy, including increased flexibility on the labour market, less red tape as well as tax incentives as part of a corporate tax reform.
“I agree with Christian Lindner. We need to do more for growth and economic dynamics,” Habeck said, adding he was working together with Lindner on a reform package.