Embed Size (px)
Citation preview
German Draft Budgetary Plan 2019
German Draft Budgetary Plan of the General Government(Federation, Länder, local authorities and social security funds)in accordance with EU-Regulation No. 473/2013
October 201
German Draft Budgetary Plan 2019
Page
Public finances in Germany ............................................................................................................................ 4
Tables:
Table 1: Impact of Coalition Agreement’s priority measures and other quantifiable measures on the general government budget balance ........................................................ 5Table 2: General government budget balance and debt .......................................................................6Table 3: Technical assumptions .......................................................................................................................7Table 4a: Forecast of macroeconomic developments... ...........................................................................8Table 4b: Price developments - deflators. ......................................................................................................9Table 4c: Labour market developments .............................. ..........................................................................9Table 4d: Sectoral balances............ .................................................................................. ..................................10Table 5a: General government budgetary targets broken down by subsector.............. .............11Table 5b: General government debt developments (Maastricht definition) ....................... ........12Table 6: Expenditure and revenue projections under the no-policy-change scenario ....... 13Table 7a: General government expenditure and revenue targets ................................................... 14Table 7b: Amounts to be excluded from the expenditure benchmark.......................................... 15Table 8: Discretionary measures at the general government and federal level ...................... 16Table 9: Divergence from April 2018 Stability Programme ............................................................. 19Table 10: Implementation of the 2018 country-specific recommendations (CSR) ................ 20Table 11: Targets of the EU’s strategy for growth and jobs ................................................................. 29Table 12: Methodological aspects ................................................................................................................... 32
CONTENTS PAGE 3
Contents
PAGE 4
Germany’s 2019 draft budgetary plan pre-sents the fiscal projections for the budgets of the Federation, Länder, local authorities and social security funds (including their off-budget entities) on the basis of current trends and planning. Sources used as the basis for making these fiscal projections are the draft 2019 federal budget (adopted by the federal government on 6 July 2018) and the financial plan to 2022 (likewise adopted by the federal government on 6 July 2018). Decisions that will have an impact on public finances were taken into account insofar as such decisions were taken by 19 September 2018. In addition, this draft budgetary plan also takes into account the federal govern-ment’s autumn projection, which forecasts a real growth rate of 1.8% in both 2018 and 2019. This means that Germany’s economy is expected to keep growing at a pace that slightly exceeds potential output.
Germany is in compliance with the re-quirements of the Stability and Growth Pact.
The draft 2019 federal budget and the financial plan to 2022, which were both adopted by the federal government on 6 July 2018, implement the priority measures contained in the Coalition Agreement be-tween the governing parties, and they do so without taking on new debt. The Coalition
Agreement includes priority measures in policy areas that are crucial for Germa-ny’s future, including education, research, universities and digital technology. It also provides for an improvement in childcare services and for extensive tax reductions benefiting private citizens, especially fami-lies (see Table 8). In addition to the priority measures agreed upon by the governing coalition, the draft budgetary plan pre-sented here includes further measures: these include tax relief also for low- and middle-income earners (adjustments to the basic personal allowance, measures to offset bracket creep, etc.); the reintroduction of the rule requiring employers and employees to pay equal contributions to statutory health insurance; measures to improve skills devel-opment opportunities and to enhance the protection provided by unemployment in-surance; a 0.5 percentage point reduction in the unemployment insurance contribution rate; measures to improve statutory pen-sion insurance benefits and to stabilise the scheme’s finances; and measures to support caregiving staff.
Public finances in Germany
Information on the draft budgetary plan in accordance with Regulation (EU) No 473/2013 of the European Parliament and of the Council of 21 May 2013 and in accordance with the related Code of Conduct
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 5
Taken together, all of these additional measures are expected to reduce the general government budget surplus by a total of roughly 4 percentage points of GDP during the projection period from 2018 to 2022 (see Tables 1 and 8). In 2019, Germany’s fiscal policy will be distinctly expansionary in terms of the change in the cyclically-ad-justed primary balance (see Table 5a); at the same time, the German economy’s positive output gap will rise from the current level of 0.5% of potential output to 0.7% in 2020. Despite considerable increases in spending and reductions in revenue, the general gov-ernment budget will not take on additional debt.
2018 2019 2020 2021 2022
Cumulative impact for the
2018 – 2022 period
– in % of GDP–
Revenue 0.0 -0.2 -0.3 -0.5 -0.5 -1.4
Expenditure 0.1 0.5 0.6 0.7 0.6 2.5
Current expenditure 0.0 0.4 0.4 0.5 0.5 1.9
Investment expenditure 0.0 0.2 0.2 0.2 0.1 0.6
Change in Budget surplus -0.1 -0.7 -0.8 -1.2 -1.1 -4.0
Any discrepancies in totals are due to rounding.
Table 1: Impact of Coalition Agreement’s priority measures and other quantifiable measures on the general government budget balance (reduced revenue (–) / additional expenditure (+) )
PAGE 6
Forecast for public finances
• The 2019 general government budget encompassing the Federation, Länder, local authorities and social security funds will run a smaller surplus: The general government budget surplus will fall from roughly 1½% of GDP in 2018 to roughly 1% of GDP in 2019. In 2019 and subsequent years, a fiscal impact will be made in particular by the priority measures contained in the Coalition Agreement and other measures. The implementation of these measures will reduce the federal budget surplus in particular. As a result, it is mainly the budgets of the Länder and local authorities that will see surpluses in the coming years..
• Compliance with medium-term budgetary objective: Germany expects to post a structural balance (i.e. the fiscal balance adjusted for cyclical and one-off effects) of +0.5% of GDP in 2019. This means that Germany will achieve its medium-term budgetary objective – i.e. a structural deficit no greater than 0.5% of GDP – with a considerable safety margin.
• Steady reduction of the debt-to-GDP ratio: Thanks to the general government budget surplus and the strong performance of the economy, Germany’s debt-to-GDP ratio (Maastricht definition) is expected to fall to 61% in the current year. The continued healthy state of public finances and the ongoing winding down of resolution authority portfolios are helping to reduce the debt ratio. Germany’s debt level will fall below the 60% upper limit in 2019 at the latest. This will further secure the sustainability of public finances in the face of various risks and the budgetary effects of demographic change.
Implementation of the country- specific recommendations
Germany’s draft budgetary plan for 2019 in-cludes key measures that aim to implement the Council’s country-specific recommen-dations of 13 July 2018. The measures will have effect in 2018 and the years that follow. The federal government will report further on the implementation of the country-spe-cific recommendations over the course of the coming European semester.
2017 2018 2019
- in % of GDP -
Budget balance 1.0 1½ 1
Structural balance 1.1 1½ ½
Maastricht debt-to-GDP ratio 63.9 61 58
Figures for the projection period are rounded to quarter percentage points of GDP.
Table 2: General government budget balance and debt
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 7
Table 3: Technical assumptions
2017 2018 2019
Short-term interest rate (annual average in %) 0.00 0.00 0.00
USD/€ exchange rate (annual average) 1.13 1.19 1.16
Growth of German sales markets (in %)1) 4.8 3¾ 3¾
Oil price (Brent, USD/barrel) 54.3 74 76
1) Figure for the projection period is rounded to quarter percentage points.Federal government autumn projection on macroeconomic developments, October 2018.
Basis for the 2019 draft budgetary plan
The 2019 draft budgetary plan is based in particular on the following sources and information:
• Act Adopting the Federal Budget for the 2018 Fiscal Year (Gesetz über die Feststellung des Bundeshaushaltsplans für das Haushaltsjahr 2018) of 12 July 2018
• Draft federal budget for 2019 and the financial plan to 2022, adopted by the federal government on 6 July 2018
• Draft Act to Reduce Statutory Health Insurance Contributions Paid by Insured Persons (Gesetz zur Beitragsentlastung der Versicherten in der gesetzlichen Krankenversicherung), adopted by the federal government on 6 June 2018
• Draft Act to Reduce Family Tax Burdens and to Modify Additional Tax Regulations (Gesetz zur steuerlichen Entlastung der Familien sowie zur Anpassung weiterer steuerlicher Regelungen), adopted by the federal government on 27 June 2018
• Draft Care Staff Support Act (Gesetz zur Stärkung des Pflegepersonals), adopted by the federal government on 1 August 2018
• Draft Act to Improve Benefits in and Stabilise the Statutory Pension Insurance Scheme (Gesetz über Leistungsverbesse-rungen und Stabilisierung in der gesetzli-chen Rentenversicherung), adopted by the federal government on 29 August 2018
• Draft Act to Enhance Skills Development Opportunities and the Protection Provided by Unemployment Insurance (Gesetz zur Stärkung der Chancen für Qualifizierung und für mehr Schutz in der Arbeitslosenversicherung), adopted by the federal government on 19 September 2018
• Results for the general government budget in the national accounts, published 24 August 2018 (Federal Statistical Office)
• Federal government autumn projection on macroeconomic developments, dated 11 October 2018, which was endorsed by the Joint Economic Forecast group as an independent body in accordance with the Forecasting Act (Vorausschätzungs-gesetz) and the Forecasting Ordinance (Vorausschätzungsverordnung)
PAGE 8
ESA Code
2017 2017 2018 2019 2020 2021 2022
Index(2010=100) Year-on-year change in %
1. Real GDP, chain index B1*g 113.66 2.2 1.8 1.8 1.8 1.3 1.3
2. Potential GDP (€bn) 2,919.2 1.7 1.7 1.7 1.7 1.7 1.5
contributions (percentage points):
- labour 0.5 0.5 0.5 0.4 0.3 0.1
- capital 0.4 0.4 0.4 0.5 0.5 0.5
- total factor productivity 0.7 0.8 0.8 0.8 0.9 0.9
3. Nominal GDP (€bn) B1*g 3,277.3 3.7 3.5 3.8 3.7 3.2 3.2
Components of real GDP, chain index
4. Private consumption expenditure1) P.3 110.26 1.8 1.6 2.0
5. Government consumption expenditure P.3 114.11 1.6 1.4 2.5
6. Gross fixed capital formation P.51g 118.21 2.9 3.0 2.7
7. Changes in inventories (contribution to GDP growth)
P.52 + P.53 - 0.1 0.1 0.0
8. Exports P.6 133.72 4.6 2.8 3.7
9. Imports P.7 131.61 4.8 3.6 4.9
Contribution to real GDP growth - in percentage points -
10. Domestic demand (excluding stocks)
- 1.8 1.8 2.1
11. Changes in inventories P.52 + P.53 - 0.1 0.1 0.0
12. External balance of goods and services
B.11 - 0.3 -0.1 -0.2
2017: Federal Statistical Office, August 2018.2018 to 2022: Federal government autumn projection on macroeconomic developments, October 2018.
1) Including private non-profit organisations serving households.
Table 4a: Forecast of macroeconomic developments
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 9
Table 4b: Price developments - deflators
2017 2017 2018 2019 2020 2021 2022
Index (2010=100) Year-on-year change in %
1. GDP 111.76 1.5 1.7 2.0 1.9 1.9 1.9
2. Private consumption expenditure1) 108.63 1.6 1.7 1.9
3. HICP - - - -
4. Government consumption expenditure 113.49 2.2 2.3 2.1
5. Gross capital formation 114.67 2.7 2.7 2.5
6. Exports 105.78 1.6 1.2 0.8
7. Imports 102.86 2.6 1.9 1.0
2017: Federal Statistical Office, August 2018. 2018 to 2022: Federal government autumn projection on macroeconomic developments, October 2018.
1) Including private non-profit organisations serving households.
Table 4c: Labour market developments
2017: Federal Statistical Office, August 2018. 2018 and 2019: Federal government autumn projection on macroeconomic developments, October 2018.
1) Persons employed, domestic concept, national accounts definition.2) National accounts definition.3) Unemployed (ILO) / economically active population.4) Real GDP per person employed (domestic); 2010=100.5) Real GDP per hour worked; 2010=100.
ESA Code
2017 2017 2018 2019
Level Year-on-year change in %
1. Employment - persons1) (in millions) 44.27 1.4 1.3 0.9
2. Employment - hours worked2) (bn hours) 60.22 1.3 1.4 0.8
3. Unemployment rate (%)3) - 3.5 3.2 2.9
4. Labour productivity - persons4) 105.3 0.7 0.4 0.9
5. Labour productivity - hours worked5) 107.6 0.9 0.3 1.0
6. Compensation of employees (€bn) D.1 1,667.6 4.3 4.6 4.2
7. Compensation per employee (thousand €) 41.7 2.6 2.9 3.1
PAGE 10
Table 4d: Sectoral balances
ESACode
2017 2018 2019
- in % of GDP -
1. Net lending/net borrowing vis-à-vis the rest of the world B.9 8.5 7.5 7.4
of which:
- Balance on goods and services 7.6 7.0 6.5
- Balance of primary incomes and transfers 0.6 1.0 0.9
2. Net lending/net borrowing of households B.9 5.1 5.0 4.7
3. Net lending/net borrowing of general government1) B.9 1.0 1½ 1
4. Statistical discrepancy - -
2017: Federal Statistical Office, August 2018. 2018 and 2019: Federal government autumn projection on macroeconomic developments, October 2018.
1) Figures for the projection period are rounded to quarter percentage points of GDP.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 11
Table 5a: General government budgetary targets broken down by subsector
ESA Code
2018 2019 2020 2021 2022
- in % of GDP -
Net lending (+)/net borrowing (-) (B.9) by subsector1)
1. General government S.13 1½ 1 ½ ½ ½
2. Central government S.1311 ½ ¼ 0 0 ¼
3. State government S.1312 ¼ ¼ ¼ ¼ ¼
4. Local government S.1313 ½ ¼ ¼ ¼ ¼
5. Social security funds S.1314 ¼ 0 0 -¼ -¼
General government (S.13)
6. Interest expenditure D.41 1 ¾ ¾ ¾ ¾
7. Primary balance2) 2½ 1¾ 1½ 1¼ 1½
8. One-off and other temporary measures3) 0 0 0 0 0
9. Real GDP growth (% change yoy) 1.8 1.8 1.8 1.3 1.3
10. Potential GDP growth (% change yoy) 1.7 1.7 1.7 1.7 1.5
contributions (percentage points):
-labour 0.5 0.5 0.4 0.3 0.1
-capital 0.4 0.4 0.5 0.5 0.5
-total factor productivity 0.8 0.8 0.8 0.9 0.9
in % of potential GDP
11. Output gap 0.5 0.6 0.7 0.3 0.1
12. Cyclical budgetary component ¼ ¼ ½ ¼ 0
13. Cyclically adjusted balance (1 - 12) 1¼ ½ ¼ ¼ ½
14. Cyclically adjusted primary balance (13 + 6) 2¼ 1½ 1 1 1¼
15. Structural balance (13 - 8)4) 1½ ½ ¼ ¼ ½
1) TR - TE = B.9.2) The primary balance is calculated as (B.9, item 1) plus (D.41, item 6).3) A plus sign means deficit-reducing one-off measures.4) The increase in the structural surplus in 2022 is partly the result of technical factors. The assumption (according to EU procedures) of an output gap closed at the end of the projection period implies a narrowing of the current positive output gap and thus a declining cyclical budgetary component. For a given budget balance, this in itself leads to an increase in the structural balance.
Figures for the projection period are rounded to quarter percentage points of GDP.Any discrepancies in totals are due to rounding.
PAGE 12
Table 5b: General government debt developments (Maastricht definition)
ESA Code
2018 2019 2020 2021 2022
- in % of GDP -
1. Gross debt 61 58 55¾ 54 52
2. Change in gross debt ratio -2¾ -3
Contributions to changes in gross debt
3. Primary balance 2½ 1¾
4. Interest expenditure D.41 -1 -¾
5. Other adjustments 1¼ 2 1½ 1½ 1½
p.m.: Implicit interest rate on debt1) 1½ 1½
1) Approximated as interest expenditure divided by previous year’s debt level.
Figures for the projection period are rounded to quarter percentage points of GDP.Any discrepancies in totals are due to rounding.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 13
Table 6: Expenditure and revenue projections under the no-policy-change scenario*
General government (S. 13) ESA Code
2018 2019
- in % of GDP -
1. Total revenue with no change in policy TR 45½ 45¼
of which:
1.1. Taxes on production and imports D.2 10½ 10½
1.2. Current taxes on income, wealth, etc. D.5 13¼ 13¼
1.3. Capital taxes D.91 0 0
1.4. Social contributions D.61 16¾ 16¾
1.5. Property income D.4 ½ ½
1.6. Other1) 4¼ 4¼
p.m.: Tax burden (D.2+D.5+D.61+D.91-D.995)2)
40½ 40½
2. Total expenditure with no change in policy TE3) 43¾ 43¾
of which:
2.1. Compensation of employees D.1 7½ 7½
2.2. Intermediate consumption P.2 4¾ 4¾
2.3. Social payments D.62 +D.632 24 23¾
of which:Unemployment benefits4) 1¼ 1
2.4. Interest expenditure D.41 1 ¾
2.5. Subsidies D.3 ¾ 1
2.6. Gross fixed capital formation P.51 2¼ 2½
2.7. Capital transfers D.9 1¼ 1
2.8. Other5) 2¼ 2¼
* Please note that the no-policy-change scenario involves the extrapolation of revenue and expenditure trends before adding the impact of the measures included in the forthcoming year’s budget.
1) P.11 + P.12 + P.131 + D.39rec + D.7rec + D.9rec (excluding D.91rec).2) Including those collected by the EU and including an adjustment for uncollected taxes and social contributions (D.995), if appropriate.3) TR - TE = B.9.4) Includes social benefits other than social transfers in kind (D.62) and social transfers in kind via market producers (D.632) related to unemployment benefits.5) D.29pay + D.4pay (excluding D.41pay) + D.5pay + D.7pay + P.52 + P.53 + NP + D.8.
Figures for the projection period are rounded to quarter percentage points of GDP.Any discrepancies in totals are due to rounding.
PAGE 14
Table 7a: General government expenditure and revenue targets
General government (S. 13) ESACode
2018 2019
- in % of GDP -
1. Total revenue TR 45½ 45¼
of which:
1.1. Taxes on production and imports D.2 10½ 10½
1.2. Current taxes on income, wealth, etc D.5 13¼ 13¼
1.3. Capital taxes D.91 0 0
1.4. Social contributions D.61 16¾ 16¾
1.5. Property income D.4 ½ ½
1.6. Other1) 4¼ 4¼
p.m.: Tax burden (D.2+D.5+D.61+D.91-D.995)2)
40½ 40½
2. Total expenditure TE3) 43¾ 44¼
of which:
2.1. Compensation of employees D.1 7½ 7½
2.2. Intermediate consumption P.2 4¾ 4¾
2.3. Social payments D.62 + D.632 24 24¼
of which: Unemployment benefits4) 1¼ 1
2.4. Interest expenditure D.41 1 ¾
2.5. Subsidies D.3 ¾ 1
2.6. Gross fixed capital formation P.51 2¼ 2½
2.7. Capital transfers D.9 1¼ 1
2.8. Other5) 2¼ 2½
1) P.11 + P.12 + P.131 + D.39rec + D.7rec + D.9rec (excluding D.91rec).2) Including those collected by the EU and including an adjustment for uncollected taxes and social contributions (D.995), if appropriate.3) TR - TE = B.9.4) Includes social benefits other than social transfers in kind (D.62) and social transfers in kind via market producers (D.632) related to unemployment benefits.5) D.29pay + D.4pay (excluding D.41pay) + D.5pay + D.7pay + P.52 + P.53 + NP + D.8.
Figures for the projection period are rounded to quarter percentage points of GDP.Any discrepancies in totals are due to rounding.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 15
Table 7b: Amounts to be excluded from the expenditure benchmark
2017 2017 2018 2019
€bn - in % of GDP -
1. Expenditure on EU programmes fully matched by EU funds revenue 3.3 0.1 0 0
2. Cyclical unemployment benefit expenditure 1.9 0.1 0 0
3. Effect of discretionary revenue measures -0.8 0.0 0 -¼
4. Revenue changes mandated by law 0.0 0.0 0 0
Figures for the projection period are rounded to quarter percentage points of GDP.
PAGE 16 Ta
ble
8:
Dis
cret
iona
ry m
easu
res
at th
e ge
nera
l gov
ernm
ent a
nd fe
dera
l lev
el
Act
ions
Det
aile
d de
scri
ptio
nES
A
code
Acc
ount
ing
prin
cipl
eA
dopt
ion
stat
us /
en
try
into
forc
e
Budg
etar
y im
pact
2018
2019
2020
2021
2022
2018
-202
2
– in
% o
f GD
P –
Prio
rity
exp
endi
ture
s la
id d
own
in th
e Co
alit
ion
Agr
eem
ent,
in th
e fo
llow
ing
key
polic
y ar
eas:
1)-0
.1-0
.3-0
.4-0
.7-0
.7-2
.2
Inve
stin
g in
the
futu
re:
Educ
atio
n, re
sear
ch,
univ
ersi
ties,
digi
tal t
ech-
nolo
gy
Incr
ease
s in
inve
stm
ents
, gr
ants
for i
nves
tmen
t, ot
her
curr
ent t
rans
fers
, and
soc
ial
bene
fits
othe
r tha
n so
cial
tr
ansf
ers
in k
ind.
P.5
D.6
2 D
.7
D.9
2
Cash
Each
of t
hese
sep
arat
e ca
tego
ries
enco
mpa
sses
a
num
ber o
f mea
sure
s th
at a
re ta
king
eff
ect
at v
ario
us p
oint
s in
tim
e. T
he in
clus
ion
of th
ese
mea
sure
s in
th
is fo
reca
st, a
nd h
ow
they
are
acc
ount
ed fo
r, is
bas
ed o
n ho
w th
e Co
aliti
on A
gree
men
t’s
impl
emen
tatio
n is
de
linea
ted
in th
e 20
18
fede
ral b
udge
t, th
e 20
19
draf
t fed
eral
bud
get
and
the
finan
cial
pla
n to
20
22.
0.0
-0.1
-0.1
-0.1
-0.1
-0.4
Fam
ily, c
hild
ren
and
so-
cial
pol
icy
Tax
redu
ctio
ns; i
ncre
ases
in
hum
an re
sour
ces
expe
nditu
re, s
ocia
l ben
efits
ot
her t
han
soci
al tr
ansf
ers
in k
ind,
and
oth
er c
urre
nt
tran
sfer
s.
D.1
D
.51
D.6
2 D
.7
Cash
0.0
-0.1
-0.1
-0.2
-0.2
-0.7
Build
ing
and
hous
ing
Tax
redu
ctio
ns, i
ncre
ases
in
inve
stm
ent g
rant
sD
.51
D.9
2Ca
sh0.
00.
0-0
.1-0
.10.
0-0
.2
Equi
tabl
e liv
ing
con-
ditio
ns, a
gric
ultu
re,
tran
spor
t and
loca
l com
-m
uniti
es
Incr
ease
s in
inve
stm
ent
gran
tsD
.92
Cash
0.0
-0.1
-0.1
-0.1
0.0
-0.2
Inte
rnat
iona
l res
pon-
sibi
lity
for s
ecur
ity a
nd
deve
lopm
ent
Incr
ease
s in
cur
rent
ex
pend
iture
and
inve
stm
ent
expe
nditu
re; i
ncre
ases
in
tran
sfer
s to
fore
ign
reci
pien
ts
P.2
P.5
D
.74
D.9
2
Cash
0.0
-0.1
0.0
0.0
0.0
-0.2
Tax
relie
f for
indi
vidu
als
Redu
ctio
n in
the
solid
arity
su
rcha
rge
D.5
1Ca
sh0.
00.
00.
0-0
.2-0
.3-0
.5
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 17Ta
ble
8:
cont
inua
tion
Act
ions
Det
aile
d de
scri
ptio
nES
A
code
Acc
ount
ing
prin
cipl
eA
dopt
ion
stat
us /
en
try
into
forc
e
Budg
etar
y im
pact
2018
2019
2020
2021
2022
2018
-202
2
– in
% o
f GD
P –
Prio
rity
exp
endi
ture
s la
id d
own
in th
e Co
alit
ion
Agr
eem
ent,
in th
e fo
llow
ing
key
polic
y ar
eas:
1)-0
.1-0
.3-0
.4-0
.7-0
.7-2
.2
Inve
stin
g in
the
futu
re:
Educ
atio
n, re
sear
ch,
univ
ersi
ties,
digi
tal t
ech-
nolo
gy
Incr
ease
s in
inve
stm
ents
, gr
ants
for i
nves
tmen
t, ot
her
curr
ent t
rans
fers
, and
soc
ial
bene
fits
othe
r tha
n so
cial
tr
ansf
ers
in k
ind.
P.5
D.6
2 D
.7
D.9
2
Cash
Each
of t
hese
sep
arat
e ca
tego
ries
enco
mpa
sses
a
num
ber o
f mea
sure
s th
at a
re ta
king
eff
ect
at v
ario
us p
oint
s in
tim
e. T
he in
clus
ion
of th
ese
mea
sure
s in
th
is fo
reca
st, a
nd h
ow
they
are
acc
ount
ed fo
r, is
bas
ed o
n ho
w th
e Co
aliti
on A
gree
men
t’s
impl
emen
tatio
n is
de
linea
ted
in th
e 20
18
fede
ral b
udge
t, th
e 20
19
draf
t fed
eral
bud
get
and
the
finan
cial
pla
n to
20
22.
0.0
-0.1
-0.1
-0.1
-0.1
-0.4
Fam
ily, c
hild
ren
and
so-
cial
pol
icy
Tax
redu
ctio
ns; i
ncre
ases
in
hum
an re
sour
ces
expe
nditu
re, s
ocia
l ben
efits
ot
her t
han
soci
al tr
ansf
ers
in k
ind,
and
oth
er c
urre
nt
tran
sfer
s.
D.1
D
.51
D.6
2 D
.7
Cash
0.0
-0.1
-0.1
-0.2
-0.2
-0.7
Build
ing
and
hous
ing
Tax
redu
ctio
ns, i
ncre
ases
in
inve
stm
ent g
rant
sD
.51
D.9
2Ca
sh0.
00.
0-0
.1-0
.10.
0-0
.2
Equi
tabl
e liv
ing
con-
ditio
ns, a
gric
ultu
re,
tran
spor
t and
loca
l com
-m
uniti
es
Incr
ease
s in
inve
stm
ent
gran
tsD
.92
Cash
0.0
-0.1
-0.1
-0.1
0.0
-0.2
Inte
rnat
iona
l res
pon-
sibi
lity
for s
ecur
ity a
nd
deve
lopm
ent
Incr
ease
s in
cur
rent
ex
pend
iture
and
inve
stm
ent
expe
nditu
re; i
ncre
ases
in
tran
sfer
s to
fore
ign
reci
pien
ts
P.2
P.5
D
.74
D.9
2
Cash
0.0
-0.1
0.0
0.0
0.0
-0.2
Tax
relie
f for
indi
vidu
als
Redu
ctio
n in
the
solid
arity
su
rcha
rge
D.5
1Ca
sh0.
00.
00.
0-0
.2-0
.3-0
.5
Act
ions
Det
aile
d de
scri
ptio
nES
A
code
Acc
ount
ing
prin
cipl
eA
dopt
ion
stat
us /
en
try
into
forc
e
Budg
etar
y im
pact
2018
2019
2020
2021
2022
2018
-202
2
– in
% o
f GD
P –
Add
itio
nal m
easu
res:
0.0
-0.3
-0.5
-0.5
-0.5
-1.8
Fam
ily T
ax B
urde
n
Redu
ctio
n A
ct (F
amili
en-
entla
stun
gsge
setz
) (m
odifi
catio
ns o
f add
i-tio
nal t
ax re
gula
tions
to
offs
et b
rack
et c
reep
)2)
Tax
redu
ctio
n th
roug
h an
in
crea
se in
the
basi
c pe
rso-
nal a
llow
ance
, an
incr
ease
in
the
max
imum
ded
uctio
n fo
r mai
nten
ance
pay
men
ts,
and
mod
ifica
tions
to ta
x br
acke
t thr
esho
lds
D.5
1Ca
sh
in th
e pa
rliam
enta
ry
proc
ess
0.0
-0.1
-0.2
-0.2
-0.2
-0.7
Act
to R
educ
e In
sure
d Pe
rson
s’ C
osts
(Ver
-sic
hert
enen
tlast
ungs
-ge
setz
) in
the
area
of
stat
utor
y he
alth
in
sura
nce
Hig
her c
ontr
ibut
ions
by
the
stat
e; re
duce
d so
cial
se
curit
y co
ntrib
utio
ns
resu
lting
from
, am
ong
othe
r thi
ngs,
(a) t
he re
intr
oduc
tion
of th
e ru
le re
quiri
ng e
mpl
oyer
s an
d em
ploy
ees
to p
ay e
qual
co
ntrib
utio
ns to
sta
tuto
ry
heal
th in
sura
nce
and
(b) a
redu
ctio
n by
hal
f of
the
basi
s fo
r ass
essi
ng
cont
ribut
ions
from
sel
f-em
ploy
ed p
erso
ns
D.1
D
.61
D.6
2Ca
shin
the
parli
amen
tary
pr
oces
s0.
0-0
.1-0
.1-0
.1-0
.1-0
.3
Skill
s D
evel
opm
ent
Opp
ortu
nitie
s Act
(Qua
-lif
izie
rung
scha
ncen
ge-
setz
) in
the
area
of u
n-em
ploy
men
t ins
uran
ce
In p
artic
ular
, inc
reas
ed
supp
ort f
or a
dvan
ced
edu-
catio
n an
d tr
aini
ng, a
nd a
0.
5 pe
rcen
tage
poi
nt re
duc-
tion
in th
e un
empl
oym
ent
insu
ranc
e co
ntrib
utio
n ra
te
D.1
D
.61
D.6
2Ca
shin
the
parli
amen
tary
pr
oces
s0.
0-0
.2-0
.2-0
.2-0
.2-0
.7
PAGE 18 Ta
ble
8:
cont
inua
tion
Act
ions
Det
aile
d de
scri
ptio
nES
A
code
Acc
ount
ing
prin
cipl
eA
dopt
ion
stat
us /
en
try
into
forc
e
Budg
etar
y im
pact
2018
2019
2020
2021
2022
2018
-202
2
– in
% o
f GD
P –
Add
itio
nal m
easu
res:
Act
to Im
prov
e Be
nefit
s in
and
Sta
bilis
e th
e
Stat
utor
y Pe
nsio
n
Insu
ranc
e Sc
hem
e
(Lei
stun
gsve
rbes
seru
ngs-
un
d St
abili
sieru
ngs-
ge
setz
)
Incl
udes
dua
l saf
ety
para
met
ers
(min
imum
be
nefit
rate
and
max
imum
co
ntrib
utio
n ra
te);
exte
nds
the
supp
lem
enta
ry
perio
ds th
at a
re a
dded
in
cal
cula
ting
pens
ions
fo
r per
sons
with
redu
ced
earn
ing
capa
city
; exp
ands
pe
nsio
n be
nefit
s fo
r m
othe
rs o
f chi
ldre
n bo
rn
befo
re 1
992;
redu
ces
cost
s fo
r low
inco
me
earn
ers;
18.
6% m
inim
um
cont
ribut
ion
rate
D.6
1 D
.62
Cash
in th
e pa
rliam
enta
ry
proc
ess
0.0
-0.1
-0.1
-0.1
-0.1
-0.3
Care
Sta
ff S
uppo
rt A
ct
(Pfle
gepe
rson
al-
Stär
kung
sges
etz)
Impr
oves
sta
ffin
g an
d w
orki
ng c
ondi
tions
in th
e fie
ld o
f car
egiv
ing3)
D.6
1 D
.63
Cash
in th
e pa
rliam
enta
ry
proc
ess
0.0
0.1
0.1
0.1
0.1
0.2
1 A
ny d
iscr
epan
cies
in to
tals
are
due
to ro
undi
ng.
2 Th
e in
crea
se in
chi
ld b
enef
it an
d th
e in
crea
se in
the
tax
allo
wan
ce fo
r chi
ldre
n ar
e al
read
y ac
coun
ted
for u
nder
“Fa
mily
, chi
ldre
n an
d so
cial
pol
icy”
abo
ve.
3) T
he fi
gure
s lis
ted
here
incl
ude
(as
a te
chni
cal a
ssum
ptio
n) a
0.3
per
cent
age
poin
t inc
reas
e in
the
cont
ribut
ion
rate
from
1 Ja
nuar
y 20
19 o
nwar
ds.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 19
Table 9: Divergence from April 2018 Stability Programme
ESA code 2017 2018 2019
Target general government net lending/net borrowing (% of GDP) B.9
Stability Programme - April 2018 1.1 1 1¼
Draft Budgetary Plan 1.0 1½ 1
Difference -0.1 ¾ -½ General government net lending/nnet borrowing with unchanged policies (% of GDP)
Stability Programme - April 2018 1.1 1 1¼
Draft Budgetary Plan - 1¾ 1½
Difference - ¾ ¼
Figures for the projection period are rounded to quarter percentage points of GDP.Any discrepancies in totals are due to rounding.
PAGE 20
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
whi
le re
spec
ting
the
med
ium
-te
rm o
bjec
tive,
use
s fi
scal
and
st
ruct
ural
pol
icie
s to
ach
ieve
a
sust
aine
d up
war
d tr
end
in p
ublic
an
d pr
ivat
e in
vest
men
t, an
d in
pa
rtic
ular
on
educ
atio
n, re
sear
ch
and
inno
vati
on a
t all
leve
ls o
f go
vern
men
t, in
par
ticu
lar a
t re
gion
al a
nd lo
cal l
evel
s;
2018
fede
ral b
udge
t Th
e 20
18 fe
dera
l bud
get o
nce
agai
n se
ts o
ut a
bal
ance
d bu
dget
with
out n
et
borr
owin
g. In
201
8, a
firs
t set
of p
riorit
y m
easu
res
set o
ut in
the
Coal
ition
Agr
ee-
men
t are
to b
e im
plem
ente
d, in
clud
ing
mea
sure
s in
rese
arch
and
dev
elop
men
t. O
vera
ll, th
e ar
eas
of e
duca
tion,
sci
ence
, and
rese
arch
, whi
ch a
re k
ey to
the
futu
re,
will
con
tinue
to b
e gi
ven
high
prio
rity,
with
aro
und
€23.
0 bi
llion
set
asi
de fo
r ed
ucat
ion
and
rese
arch
spe
ndin
g (a
ctua
l am
ount
in 2
017:
aro
und
€21.
9 bi
llion
).
Fede
ral i
nves
tmen
t spe
ndin
g is
incr
easi
ng (e
xcl.
inve
stm
ent a
lloca
tion
to th
e
inve
stm
ent f
und
for d
igita
l inf
rast
ruct
ure
of €
2.4
billi
on) t
o €3
7.4
billi
on (u
p ar
ound
€3.
4 bi
llion
ove
r the
act
ual a
mou
nt in
201
7). I
n 20
18, i
nves
tmen
t in
tran
spor
t alo
ne h
as in
crea
sed
to €
14.1
bill
ion.
2018
Bud
get A
ct h
as
been
in e
ffec
t sin
ce
1 Ja
nuar
y 20
18.
2019
fede
ral b
udge
tTh
e dr
aft 2
019
fede
ral b
udge
t pro
vide
s fo
r a b
alan
ced
budg
et w
ithou
t net
bo
rrow
ing.
Thi
s re
pres
ents
a c
ontin
uatio
n of
Ger
man
y’s
cour
se o
f sou
nd b
udg-
etar
y an
d fis
cal p
olic
y w
hich
is fo
cuse
d on
gro
wth
and
soc
ial e
quity
and
whi
ch
inve
sts
in th
e fu
ture
. Ger
man
y’s
inve
stm
ent s
pend
ing
targ
et fo
r 201
9 (€
37.9
bi
llion
) is
high
er th
an in
201
8 (€
37.4
bill
ion)
(exc
l. in
vest
men
t allo
catio
n to
the
spec
ial f
und
for d
igita
l inf
rast
ruct
ure
of €
2.4
billi
on).
A pr
iorit
y is
bei
ng p
lace
d on
tran
spor
t inf
rast
ruct
ure,
fund
ing
for t
he c
onst
ruct
ion
of s
ocia
l hou
sing
, and
a
new
gra
nt th
at a
ims
to h
elp
fam
ilies
with
chi
ldre
n bu
y or
bui
ld o
wne
r-oc
cupi
ed
hous
ing.
A to
tal o
f €23
.9 7
bill
ion
have
bee
n ea
rmar
ked
for e
duca
tion
and
rese
arch
sp
endi
ng in
201
9, s
ome
€0.8
bill
ion
mor
e th
an th
e ta
rget
am
ount
for 2
018.
In
addi
tion,
the
burd
en o
n th
e Lä
nder
and
loca
l aut
horit
ies
is to
be
cons
ider
ably
re
duce
d, e
nabl
ing
addi
tiona
l inv
estm
ent m
easu
res
to b
e ta
ken
at th
ese
leve
ls,
ther
eby
boos
ting
educ
atio
n an
d re
sear
ch.
Cabi
net d
ecis
ion
of 6
Ju
ly 2
018
(cha
nges
in
parli
amen
tary
pro
ce-
dure
pos
sibl
e).
Ente
rs in
to fo
rce
on
1 Ja
nuar
y 20
19.
Prom
otin
g in
vest
-m
ent b
y fin
anci
ally
w
eak
mun
icip
aliti
es
The
volu
me
of th
e Lo
cal A
utho
rity
Inve
stm
ent P
rom
otio
n Fu
nd h
as b
een
doub
led
to €
7 bi
llion
.
From
1 Ju
ly 2
017
to th
e en
d of
202
2, th
e fe
dera
l gov
ernm
ent i
s pr
ovid
ing
finan
cial
as
sist
ance
am
ount
ing
to €
3.5
billi
on fo
r the
mod
erni
satio
n, re
build
ing
and
ex
pans
ion
of s
choo
l bui
ldin
gs in
fina
ncia
lly w
eak
mun
icip
aliti
es.
The
first
fund
ing
prog
ram
me,
whi
ch w
as la
unch
ed in
mid
-201
5 w
ith a
bud
get o
f €3
.5 b
illio
n, w
ill s
till b
e av
aila
ble
to fi
nanc
ially
wea
k m
unic
ipal
ities
unt
il th
e en
d of
202
0 fo
r inf
rast
ruct
ure
inve
stm
ent i
n ar
eas
such
as
nois
e co
ntro
l, ho
spita
ls a
nd
urba
n de
velo
pmen
t.
Am
endm
ent t
o th
e A
ct
esta
blis
hing
a L
ocal
A
utho
rity
Inve
stm
ent
Prom
otio
n Fu
nd a
nd
the
amen
dmen
t of
the
Loca
l Aut
horit
y In
vest
men
t Pro
mot
ion
Act
of 1
4 A
ugus
t 201
7.
Tabl
e 10
: Im
plem
enta
tion
of th
e 20
18 c
ount
ry-s
peci
fic re
com
men
datio
ns (C
SR)
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 21Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
Acc
ordi
ng to
the
repo
rts
subm
itted
by
the
Länd
er a
s of
30
June
201
8, a
ppro
x. 9
4%
of th
e fu
ndin
g pr
ovid
ed b
y th
e fe
dera
l gov
ernm
ent f
or th
is p
rogr
amm
e ha
s al
read
y be
en e
arm
arke
d fo
r spe
cific
inve
stm
ent m
easu
res.
Rest
ruct
urin
g of
the
finan
cial
re
latio
nshi
ps
betw
een
the
Fede
ratio
n an
d th
e Lä
nder
The
rest
ruct
urin
g of
fede
ral-
Länd
er fi
scal
rela
tions
will
brin
g th
e Lä
nder
ann
ual
fisca
l rel
ief o
f jus
t ove
r €9.
7 bi
llion
from
202
0. T
he re
form
will
als
o se
rve
to
mod
erni
se th
e w
ay in
whi
ch ta
sks
are
perf
orm
ed b
y th
e Lä
nder
and
to s
tren
gthe
n th
e ro
le o
f the
fede
ral g
over
nmen
t. Th
e re
stru
ctur
ing
of fi
scal
rela
tions
bet
wee
n th
e Fe
dera
tion
and
the
Länd
er e
stab
lishe
s th
e fr
amew
ork
for l
ong-
term
sou
nd
budg
ets
at fe
dera
l and
Län
der l
evel
and
for l
ong-
term
com
plia
nce
with
bor
row
ing
limits
. Thi
s w
ill e
nsur
e th
at th
e va
rious
leve
ls o
f gov
ernm
ent a
re a
ble
to fu
nctio
n an
d w
ill in
crea
se th
e re
spon
sibi
lity
of th
e te
rrito
rial a
utho
ritie
s fo
r the
ir re
spec
tive
budg
ets.
This
not
leas
t im
prov
es th
e fr
amew
ork
for s
usta
inab
le in
vest
men
t, w
hich
–
in a
cou
ntry
with
a fe
dera
l str
uctu
re –
is th
e re
spon
sibi
lity
of th
e re
spec
tive
com
pete
nt a
utho
ritie
s at
the
fede
ral,
regi
onal
and
loca
l lev
el.
Act
am
endi
ng
the
Basi
c La
w
(pro
mul
gate
d on
19
July
201
7);
Act
on
the
rest
ruct
urin
g of
th
e na
tiona
l fisc
al
equa
lisat
ion
syst
em
as fr
om 2
020
and
on
the
mod
ifica
tion
of
budg
etar
y pr
ovis
ions
(p
rom
ulga
ted
on
17 A
ugus
t 201
7).
The
revi
sion
of c
onst
itutio
nal r
ules
on
publ
ic fi
nanc
es g
ives
the
Fede
ratio
n m
ore
poss
ibili
ties
to s
uppo
rt L
ände
r and
loca
l aut
horit
y in
vest
men
t in
area
s th
at a
re
rele
vant
for t
he c
ount
ry a
s a
who
le, s
uch
as in
loca
l edu
catio
nal i
nfra
stru
ctur
e,
soci
al h
ousi
ng c
onst
ruct
ion,
and
pub
lic ra
il tr
ansp
ort.
Dra
ft o
f an
Act
A
men
ding
the
Ger
man
Ba
sic
Law
(Art
icle
s 10
4c, 1
04d,
125
c, 1
43e)
; Ca
bine
t dec
isio
n of
2
May
201
8; le
gisl
ativ
e pr
oces
s on
goin
g.
Com
plia
nce
with
th
e m
ediu
m-t
erm
bu
dget
ary
obje
ctiv
e (M
TO)
Sinc
e 20
12, G
erm
any
has
com
plie
d w
ith it
s m
ediu
m-t
erm
bud
geta
ry o
bjec
tive
of a
ge
nera
l gov
ernm
ent s
truc
tura
l defi
cit n
o hi
gher
than
0.5
% o
f GD
P an
d w
ill a
lso
be
able
to m
eet t
his
obje
ctiv
e in
the
com
ing
year
s (p
roje
ctio
n pe
riod
up to
202
2).
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
whi
le re
spec
ting
the
med
ium
-te
rm o
bjec
tive,
use
s fi
scal
and
st
ruct
ural
pol
icie
s to
ach
ieve
a
sust
aine
d up
war
d tr
end
in p
ublic
an
d pr
ivat
e in
vest
men
t, an
d in
pa
rtic
ular
on
educ
atio
n, re
sear
ch
and
inno
vati
on a
t all
leve
ls o
f go
vern
men
t, in
par
ticu
lar a
t re
gion
al a
nd lo
cal l
evel
s;
2018
fede
ral b
udge
t Th
e 20
18 fe
dera
l bud
get o
nce
agai
n se
ts o
ut a
bal
ance
d bu
dget
with
out n
et
borr
owin
g. In
201
8, a
firs
t set
of p
riorit
y m
easu
res
set o
ut in
the
Coal
ition
Agr
ee-
men
t are
to b
e im
plem
ente
d, in
clud
ing
mea
sure
s in
rese
arch
and
dev
elop
men
t. O
vera
ll, th
e ar
eas
of e
duca
tion,
sci
ence
, and
rese
arch
, whi
ch a
re k
ey to
the
futu
re,
will
con
tinue
to b
e gi
ven
high
prio
rity,
with
aro
und
€23.
0 bi
llion
set
asi
de fo
r ed
ucat
ion
and
rese
arch
spe
ndin
g (a
ctua
l am
ount
in 2
017:
aro
und
€21.
9 bi
llion
).
Fede
ral i
nves
tmen
t spe
ndin
g is
incr
easi
ng (e
xcl.
inve
stm
ent a
lloca
tion
to th
e
inve
stm
ent f
und
for d
igita
l inf
rast
ruct
ure
of €
2.4
billi
on) t
o €3
7.4
billi
on (u
p ar
ound
€3.
4 bi
llion
ove
r the
act
ual a
mou
nt in
201
7). I
n 20
18, i
nves
tmen
t in
tran
spor
t alo
ne h
as in
crea
sed
to €
14.1
bill
ion.
2018
Bud
get A
ct h
as
been
in e
ffec
t sin
ce
1 Ja
nuar
y 20
18.
2019
fede
ral b
udge
tTh
e dr
aft 2
019
fede
ral b
udge
t pro
vide
s fo
r a b
alan
ced
budg
et w
ithou
t net
bo
rrow
ing.
Thi
s re
pres
ents
a c
ontin
uatio
n of
Ger
man
y’s
cour
se o
f sou
nd b
udg-
etar
y an
d fis
cal p
olic
y w
hich
is fo
cuse
d on
gro
wth
and
soc
ial e
quity
and
whi
ch
inve
sts
in th
e fu
ture
. Ger
man
y’s
inve
stm
ent s
pend
ing
targ
et fo
r 201
9 (€
37.9
bi
llion
) is
high
er th
an in
201
8 (€
37.4
bill
ion)
(exc
l. in
vest
men
t allo
catio
n to
the
spec
ial f
und
for d
igita
l inf
rast
ruct
ure
of €
2.4
billi
on).
A pr
iorit
y is
bei
ng p
lace
d on
tran
spor
t inf
rast
ruct
ure,
fund
ing
for t
he c
onst
ruct
ion
of s
ocia
l hou
sing
, and
a
new
gra
nt th
at a
ims
to h
elp
fam
ilies
with
chi
ldre
n bu
y or
bui
ld o
wne
r-oc
cupi
ed
hous
ing.
A to
tal o
f €23
.9 7
bill
ion
have
bee
n ea
rmar
ked
for e
duca
tion
and
rese
arch
sp
endi
ng in
201
9, s
ome
€0.8
bill
ion
mor
e th
an th
e ta
rget
am
ount
for 2
018.
In
addi
tion,
the
burd
en o
n th
e Lä
nder
and
loca
l aut
horit
ies
is to
be
cons
ider
ably
re
duce
d, e
nabl
ing
addi
tiona
l inv
estm
ent m
easu
res
to b
e ta
ken
at th
ese
leve
ls,
ther
eby
boos
ting
educ
atio
n an
d re
sear
ch.
Cabi
net d
ecis
ion
of 6
Ju
ly 2
018
(cha
nges
in
parli
amen
tary
pro
ce-
dure
pos
sibl
e).
Ente
rs in
to fo
rce
on
1 Ja
nuar
y 20
19.
Prom
otin
g in
vest
-m
ent b
y fin
anci
ally
w
eak
mun
icip
aliti
es
The
volu
me
of th
e Lo
cal A
utho
rity
Inve
stm
ent P
rom
otio
n Fu
nd h
as b
een
doub
led
to €
7 bi
llion
.
From
1 Ju
ly 2
017
to th
e en
d of
202
2, th
e fe
dera
l gov
ernm
ent i
s pr
ovid
ing
finan
cial
as
sist
ance
am
ount
ing
to €
3.5
billi
on fo
r the
mod
erni
satio
n, re
build
ing
and
ex
pans
ion
of s
choo
l bui
ldin
gs in
fina
ncia
lly w
eak
mun
icip
aliti
es.
The
first
fund
ing
prog
ram
me,
whi
ch w
as la
unch
ed in
mid
-201
5 w
ith a
bud
get o
f €3
.5 b
illio
n, w
ill s
till b
e av
aila
ble
to fi
nanc
ially
wea
k m
unic
ipal
ities
unt
il th
e en
d of
202
0 fo
r inf
rast
ruct
ure
inve
stm
ent i
n ar
eas
such
as
nois
e co
ntro
l, ho
spita
ls a
nd
urba
n de
velo
pmen
t.
Am
endm
ent t
o th
e A
ct
esta
blis
hing
a L
ocal
A
utho
rity
Inve
stm
ent
Prom
otio
n Fu
nd a
nd
the
amen
dmen
t of
the
Loca
l Aut
horit
y In
vest
men
t Pro
mot
ion
Act
of 1
4 A
ugus
t 201
7.
PAGE 22 Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
step
s up
eff
orts
to e
nsur
e th
e av
aila
bilit
y of
ver
y hi
gh-c
apac
-it
y br
oadb
and
infr
astr
uctu
re
nati
onw
ide;
Re-d
esig
n of
the
fede
ral g
over
nmen
t’s
broa
dban
d fu
ndin
g pr
ogra
mm
e to
war
ds
a gr
eate
r foc
us o
n gi
gabi
t net
wor
ks.
In th
e 20
18 C
oalit
ion
Agr
eem
ent,
the
fede
ral g
over
nmen
t has
set
itse
lf th
e ta
rget
of
cre
atin
g a
natio
nwid
e in
fras
truc
ture
of g
igab
it ne
twor
ks b
y 20
25. T
his
invo
lves
sw
itchi
ng o
ver t
o th
e us
e of
gla
ss-fi
bre
tech
nolo
gy.
As
a fir
st s
tep,
the
exis
ting
fund
ing
guid
elin
es w
hich
pro
vide
for b
road
band
fu
ndin
g in
are
as w
here
the
mar
ket i
s no
t act
ive
(kno
wn
as ‘w
hite
zon
es’)
have
bee
n ad
apte
d to
take
acc
ount
of t
he g
igab
it ta
rget
.
Subm
issi
on o
f app
licat
ions
has
bee
n po
ssib
le s
ince
1 A
ugus
t 201
8.
Up
until
the
end
of th
e ye
ar, m
unic
ipal
ities
who
se fu
ndin
g pr
ojec
ts h
ave
hith
erto
fo
cuse
d on
vec
torin
g te
chno
logy
hav
e th
e op
port
unity
to u
pgra
de a
nd s
witc
h to
pr
omot
ing
glas
s-fib
re te
chno
logy
.
In a
sec
ond
step
, gig
abit
fund
ing
will
als
o be
ext
ende
d to
are
as th
at a
re a
lread
y su
pplie
d w
ith 3
0 M
bit/
s in
tern
et b
ut w
here
priv
atel
y fu
nded
gig
abit
netw
orks
are
no
t set
to b
e bu
ilt in
the
fore
seea
ble
futu
re.
In 2
018,
the
Dig
ital I
nfra
stru
ctur
e fu
nd w
as la
unch
ed, w
ith p
re-fi
nanc
ing
of €
2.4
mill
ion.
It h
as b
een
set u
p to
fina
nce
the
expa
nsio
n of
the
giga
bit n
etw
ork
and
impl
emen
t the
dig
ital p
acka
ge fo
r sch
ools
. In
2019
, rev
enue
from
the
allo
catio
n of
5G
freq
uenc
ies
is to
be
pum
ped
into
the
fund
.
The
curr
ent g
uide
lines
w
ere
amen
ded
in Ju
ly
2018
.
Fund
ing
is to
be
exte
nded
to s
choo
ls
etc.
from
aut
umn
2018
.
Not
ifica
tion
of a
new
fu
ndin
g fr
amew
ork
for w
hat a
re k
now
n as
‘gre
y zo
nes’
is to
be
giv
en a
t the
end
of
201
8/be
ginn
ing
of
2019
.
impr
oves
the
effi
cien
cy a
nd
inve
stm
ent-
frie
ndlin
ess
of th
e ta
x sy
stem
;
Act
to M
oder
nise
Ta
xatio
n Pr
oced
ures
The
Act
to M
oder
nise
Tax
atio
n Pr
oced
ures
aim
s to
mak
e ta
x pr
oced
ures
mor
e ef
-fic
ient
and
eco
nom
ical
by
incr
easi
ng th
e us
e of
IT a
nd e
nsur
ing
the
mor
e ta
rget
ed
use
of ta
x re
venu
e. T
his
will
ens
ure
fair
and
equa
l tax
enf
orce
men
t and
str
engt
hen
Ger
man
y’s
posi
tion
as a
cen
tre
for b
usin
ess
and
inve
stm
ent.
Colle
ctin
g ta
xes
will
be
com
e ea
sier
, fas
ter a
nd m
ore
effic
ient
.
Broa
dly
ente
red
into
fo
rce
on 1
Janu
ary
2017
(Fed
eral
Law
Gaz
ette
I,
2016
no.
35,
p. 1
679)
.
Act
to C
omba
t H
arm
ful T
ax P
rac-
tices
in C
onne
ctio
n w
ith th
e Tr
ansf
er o
f Ri
ghts
This
Act
intr
oduc
ed a
new
Sec
tion
4j in
the
Inco
me
Tax
Act
(Ein
kom
men
steu
er-
gese
tz) w
ith e
ffec
t fro
m 2
018.
Und
er th
e ne
w p
rovi
sion
s, ex
pens
es in
con
nect
ion
with
the
licen
sing
of r
ight
s to
a re
late
d pa
rty
as d
efine
d in
Sec
tion
1 (2
) of t
he
Exte
rnal
Tax
Rel
atio
ns A
ct (A
ußen
steu
erge
setz
) may
not
be
dedu
cted
, or m
ay o
nly
be d
educ
ted
in p
art,
if th
e re
cipi
ent o
f the
pay
men
t is
not t
axed
for t
his
paym
ent,
or is
onl
y ta
xed
at a
low
rate
, on
acco
unt o
f a p
refe
rent
ial t
reat
men
t reg
ime
(kno
wn
as “
IP b
oxes
”, “l
icen
se b
oxes
” or
“pa
tent
box
es”)
.
Sect
ion
4j o
f the
In
com
e Ta
x A
ct is
ef
fect
ive
for e
xpen
ses
incu
rred
aft
er
31 D
ecem
ber 2
017.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 23Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
step
s up
eff
orts
to e
nsur
e th
e av
aila
bilit
y of
ver
y hi
gh-c
apac
-it
y br
oadb
and
infr
astr
uctu
re
nati
onw
ide;
Re-d
esig
n of
the
fede
ral g
over
nmen
t’s
broa
dban
d fu
ndin
g pr
ogra
mm
e to
war
ds
a gr
eate
r foc
us o
n gi
gabi
t net
wor
ks.
In th
e 20
18 C
oalit
ion
Agr
eem
ent,
the
fede
ral g
over
nmen
t has
set
itse
lf th
e ta
rget
of
cre
atin
g a
natio
nwid
e in
fras
truc
ture
of g
igab
it ne
twor
ks b
y 20
25. T
his
invo
lves
sw
itchi
ng o
ver t
o th
e us
e of
gla
ss-fi
bre
tech
nolo
gy.
As
a fir
st s
tep,
the
exis
ting
fund
ing
guid
elin
es w
hich
pro
vide
for b
road
band
fu
ndin
g in
are
as w
here
the
mar
ket i
s no
t act
ive
(kno
wn
as ‘w
hite
zon
es’)
have
bee
n ad
apte
d to
take
acc
ount
of t
he g
igab
it ta
rget
.
Subm
issi
on o
f app
licat
ions
has
bee
n po
ssib
le s
ince
1 A
ugus
t 201
8.
Up
until
the
end
of th
e ye
ar, m
unic
ipal
ities
who
se fu
ndin
g pr
ojec
ts h
ave
hith
erto
fo
cuse
d on
vec
torin
g te
chno
logy
hav
e th
e op
port
unity
to u
pgra
de a
nd s
witc
h to
pr
omot
ing
glas
s-fib
re te
chno
logy
.
In a
sec
ond
step
, gig
abit
fund
ing
will
als
o be
ext
ende
d to
are
as th
at a
re a
lread
y su
pplie
d w
ith 3
0 M
bit/
s in
tern
et b
ut w
here
priv
atel
y fu
nded
gig
abit
netw
orks
are
no
t set
to b
e bu
ilt in
the
fore
seea
ble
futu
re.
In 2
018,
the
Dig
ital I
nfra
stru
ctur
e fu
nd w
as la
unch
ed, w
ith p
re-fi
nanc
ing
of €
2.4
mill
ion.
It h
as b
een
set u
p to
fina
nce
the
expa
nsio
n of
the
giga
bit n
etw
ork
and
impl
emen
t the
dig
ital p
acka
ge fo
r sch
ools
. In
2019
, rev
enue
from
the
allo
catio
n of
5G
freq
uenc
ies
is to
be
pum
ped
into
the
fund
.
The
curr
ent g
uide
lines
w
ere
amen
ded
in Ju
ly
2018
.
Fund
ing
is to
be
exte
nded
to s
choo
ls
etc.
from
aut
umn
2018
.
Not
ifica
tion
of a
new
fu
ndin
g fr
amew
ork
for w
hat a
re k
now
n as
‘gre
y zo
nes’
is to
be
giv
en a
t the
end
of
201
8/be
ginn
ing
of
2019
.
impr
oves
the
effi
cien
cy a
nd
inve
stm
ent-
frie
ndlin
ess
of th
e ta
x sy
stem
;
Act
to M
oder
nise
Ta
xatio
n Pr
oced
ures
The
Act
to M
oder
nise
Tax
atio
n Pr
oced
ures
aim
s to
mak
e ta
x pr
oced
ures
mor
e ef
-fic
ient
and
eco
nom
ical
by
incr
easi
ng th
e us
e of
IT a
nd e
nsur
ing
the
mor
e ta
rget
ed
use
of ta
x re
venu
e. T
his
will
ens
ure
fair
and
equa
l tax
enf
orce
men
t and
str
engt
hen
Ger
man
y’s
posi
tion
as a
cen
tre
for b
usin
ess
and
inve
stm
ent.
Colle
ctin
g ta
xes
will
be
com
e ea
sier
, fas
ter a
nd m
ore
effic
ient
.
Broa
dly
ente
red
into
fo
rce
on 1
Janu
ary
2017
(Fed
eral
Law
Gaz
ette
I,
2016
no.
35,
p. 1
679)
.
Act
to C
omba
t H
arm
ful T
ax P
rac-
tices
in C
onne
ctio
n w
ith th
e Tr
ansf
er o
f Ri
ghts
This
Act
intr
oduc
ed a
new
Sec
tion
4j in
the
Inco
me
Tax
Act
(Ein
kom
men
steu
er-
gese
tz) w
ith e
ffec
t fro
m 2
018.
Und
er th
e ne
w p
rovi
sion
s, ex
pens
es in
con
nect
ion
with
the
licen
sing
of r
ight
s to
a re
late
d pa
rty
as d
efine
d in
Sec
tion
1 (2
) of t
he
Exte
rnal
Tax
Rel
atio
ns A
ct (A
ußen
steu
erge
setz
) may
not
be
dedu
cted
, or m
ay o
nly
be d
educ
ted
in p
art,
if th
e re
cipi
ent o
f the
pay
men
t is
not t
axed
for t
his
paym
ent,
or is
onl
y ta
xed
at a
low
rate
, on
acco
unt o
f a p
refe
rent
ial t
reat
men
t reg
ime
(kno
wn
as “
IP b
oxes
”, “l
icen
se b
oxes
” or
“pa
tent
box
es”)
.
Sect
ion
4j o
f the
In
com
e Ta
x A
ct is
ef
fect
ive
for e
xpen
ses
incu
rred
aft
er
31 D
ecem
ber 2
017.
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
(Ges
etz
gege
n
schä
dlic
he S
teue
r-pr
aktik
en im
Zus
am-
men
hang
mit
Rech
te-
über
lass
unge
n)
Pref
eren
tial t
reat
men
t reg
imes
that
mee
t the
sub
stan
tial a
ctiv
ity re
quire
men
t and
th
ereb
y co
mpl
y w
ith th
e “n
exus
app
roac
h” a
gree
d by
the
OEC
D a
nd G
20 a
re n
ot
deem
ed h
arm
ful a
nd th
eref
ore
do n
ot fa
ll w
ithin
the
scop
e of
this
rule
.
In a
dditi
on, t
he th
resh
old
for i
mm
edia
te d
epre
ciat
ion
of lo
w-v
alue
ass
ets
has
been
ra
ised
from
€41
0 to
€80
0, th
e lo
wer
thre
shol
d fo
r the
form
atio
n of
a c
olle
ctiv
e ite
m h
as b
een
incr
ease
d fr
om €
150
to €
250
and
the
tax
exem
ptio
n fo
r the
INV
EST
gran
t (Se
ctio
n 3,
Num
ber 7
1 of
the
Inco
me
Tax
Act
) has
bee
n ad
apte
d to
the
new
fu
ndin
g gu
idel
ines
that
app
ly w
ith e
ffec
t fro
m 1
Janu
ary
2017
.
Act
to R
efor
m
Inve
stm
ent T
axat
ion
(Ges
etz
zur R
efor
m
der I
nves
tmen
t-be
steu
erun
g)
The
refo
rm o
f inv
estm
ent t
axat
ion
purs
ues
the
follo
win
g go
als
in p
artic
ular
:
• El
imin
ate
risks
rela
ting
to E
U la
w.
• Pr
even
t ind
ivid
ual a
ggre
ssiv
e ta
x ar
rang
emen
ts a
nd re
duce
the
over
all
susc
eptib
ility
of i
nves
tmen
t tax
atio
n la
w to
cre
ativ
e ta
x st
ruct
ures
.
• Co
nsid
erab
ly re
duce
the
effo
rt th
at b
usin
esse
s an
d in
divi
dual
s m
ust m
ake
to
dete
rmin
e ta
x ba
ses
on th
e on
e ha
nd, a
nd th
e ad
min
istr
ativ
e bu
rden
s of
tax
adm
inis
trat
ions
on
the
othe
r, in
mas
s ta
x pr
oced
ures
for m
utua
l inv
estm
ent
fund
s an
d th
eir i
nves
tors
.
• El
imin
ate
the
prac
tice
of a
void
ing
taxe
s on
div
iden
ds b
y en
gagi
ng in
div
iden
d-ar
bitr
age
tran
sact
ions
(cum
-cum
dea
ls).
In fo
rce
sinc
e
27 Ju
ly 2
016.
Rul
es
esse
ntia
lly a
pply
from
1
Janu
ary
2018
.
stre
ngth
ens
com
peti
tion
in
busi
ness
ser
vice
s an
d re
gula
ted
prof
essi
ons;
Revi
ew o
f the
Eur
o-pe
an C
omm
issi
on’s
re
form
reco
mm
en-
datio
ns re
gard
ing
regu
latio
n in
pro
fes-
sion
al s
ervi
ces
The
fede
ral g
over
nmen
t is
taki
ng th
e Eu
rope
an C
omm
issi
on’s
reco
mm
enda
tions
fo
r reg
ulat
ion
in p
rofe
ssio
nal s
ervi
ces
as a
n op
port
unity
to a
gain
exa
min
e th
e re
gula
tions
in p
rofe
ssio
nal s
ervi
ces
addr
esse
d in
the
com
mun
icat
ion.
Revi
ew in
this
legi
s-la
tive
term
with
due
re
gard
to th
e pr
oces
s fo
r tra
ckin
g th
e re
form
re
com
men
datio
ns a
t EU
leve
l.
PAGE 24 Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
The
follo
win
g re
com
men
datio
ns h
ave
been
impl
emen
ted
so fa
r: Im
plem
enta
tion
of D
irect
ive
2013
/55/
EU fo
r pat
ent a
ttor
neys
; the
reco
mm
enda
tion
rega
rdin
g tr
ansp
aren
cy a
nd le
gal c
erta
inty
in th
e pr
ovis
ion
of ta
x ad
viso
ry s
ervi
ces
by
busi
ness
es e
stab
lishe
d in
oth
er M
embe
r Sta
tes
has
been
impl
emen
ted
in th
e am
ende
d A
ct to
Com
bat T
ax A
void
ance
(Ste
ueru
mge
hung
sbek
ämpf
ungs
gese
tz)
of 2
3 Ju
ne 2
017;
dec
isio
n no
t to
regu
late
the
real
est
ate
agen
t pro
fess
ion
(onl
y in
trod
uctio
n of
a re
quire
men
t for
regu
lar c
ontin
uing
trai
ning
).
Fee
scal
e or
dina
nce
for t
ax a
dvis
ers
and
the
stat
utor
y fe
e sc
hedu
le fo
r arc
hi-
tect
s an
d en
gine
ers
The
fede
ral g
over
nmen
t is
also
taki
ng in
to a
ccou
nt th
e fa
ct th
at th
e Eu
rope
an
Com
mis
sion
laun
ched
infr
inge
men
t pro
ceed
ings
aga
inst
Ger
man
y on
18
June
20
15 in
vie
w o
f the
stip
ulat
ion
of m
inim
um fe
es in
the
ordi
nanc
e on
fees
for
tax
advi
sers
and
the
stat
utor
y fe
e sc
hedu
le fo
r arc
hite
cts
and
engi
neer
s. Th
e pr
ovis
ions
laid
dow
n in
the
ordi
nanc
e on
fees
for t
ax a
dvis
ers
have
sin
ce b
een
adap
ted
acco
rdin
gly.
With
rega
rd to
the
stat
utor
y fe
e sc
hedu
le fo
r arc
hite
cts
and
engi
neer
s (H
OA
I), w
hich
is c
urre
ntly
onl
y ap
plic
able
to d
omes
tic s
ervi
ce p
rovi
ders
, th
e Eu
rope
an C
omm
issi
on h
as b
roug
ht le
gal a
ctio
n be
fore
the
Euro
pean
Cou
rt
of Ju
stic
e. T
he s
tate
men
t of c
laim
was
tran
smitt
ed to
Ger
man
y on
28
June
201
7.
On
7 Se
ptem
ber 2
017,
the
fede
ral g
over
nmen
t sta
ted
in it
s de
fenc
e th
at it
can
not
perc
eive
any
vio
latio
n of
free
dom
of e
stab
lishm
ent,
and
that
it is
legi
timat
e to
fix
fees
for r
easo
ns s
uch
as c
onsu
mer
pro
tect
ion
and
qual
ity a
ssur
ance
. The
ora
l he
arin
g in
thes
e pr
ocee
ding
s w
ill ta
ke p
lace
at t
he E
urop
ean
Cour
t of J
ustic
e on
7
Nov
embe
r 201
8.
The
prov
isio
ns o
f the
or
dina
nce
on fe
es
for t
ax a
dvis
ers
wer
e am
ende
d by
Art
icle
9
of th
e Th
ird O
rdin
ance
A
men
ding
Tax
Reg
u-la
tions
of 1
8 Ju
ly 2
016
(Fed
eral
Law
Gaz
ette
I,
p. 1
722)
.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 25Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
1: P
ublic
in
vest
men
t and
com
peti
tion
The
follo
win
g re
com
men
datio
ns h
ave
been
impl
emen
ted
so fa
r: Im
plem
enta
tion
of D
irect
ive
2013
/55/
EU fo
r pat
ent a
ttor
neys
; the
reco
mm
enda
tion
rega
rdin
g tr
ansp
aren
cy a
nd le
gal c
erta
inty
in th
e pr
ovis
ion
of ta
x ad
viso
ry s
ervi
ces
by
busi
ness
es e
stab
lishe
d in
oth
er M
embe
r Sta
tes
has
been
impl
emen
ted
in th
e am
ende
d A
ct to
Com
bat T
ax A
void
ance
(Ste
ueru
mge
hung
sbek
ämpf
ungs
gese
tz)
of 2
3 Ju
ne 2
017;
dec
isio
n no
t to
regu
late
the
real
est
ate
agen
t pro
fess
ion
(onl
y in
trod
uctio
n of
a re
quire
men
t for
regu
lar c
ontin
uing
trai
ning
).
Fee
scal
e or
dina
nce
for t
ax a
dvis
ers
and
the
stat
utor
y fe
e sc
hedu
le fo
r arc
hi-
tect
s an
d en
gine
ers
The
fede
ral g
over
nmen
t is
also
taki
ng in
to a
ccou
nt th
e fa
ct th
at th
e Eu
rope
an
Com
mis
sion
laun
ched
infr
inge
men
t pro
ceed
ings
aga
inst
Ger
man
y on
18
June
20
15 in
vie
w o
f the
stip
ulat
ion
of m
inim
um fe
es in
the
ordi
nanc
e on
fees
for
tax
advi
sers
and
the
stat
utor
y fe
e sc
hedu
le fo
r arc
hite
cts
and
engi
neer
s. Th
e pr
ovis
ions
laid
dow
n in
the
ordi
nanc
e on
fees
for t
ax a
dvis
ers
have
sin
ce b
een
adap
ted
acco
rdin
gly.
With
rega
rd to
the
stat
utor
y fe
e sc
hedu
le fo
r arc
hite
cts
and
engi
neer
s (H
OA
I), w
hich
is c
urre
ntly
onl
y ap
plic
able
to d
omes
tic s
ervi
ce p
rovi
ders
, th
e Eu
rope
an C
omm
issi
on h
as b
roug
ht le
gal a
ctio
n be
fore
the
Euro
pean
Cou
rt
of Ju
stic
e. T
he s
tate
men
t of c
laim
was
tran
smitt
ed to
Ger
man
y on
28
June
201
7.
On
7 Se
ptem
ber 2
017,
the
fede
ral g
over
nmen
t sta
ted
in it
s de
fenc
e th
at it
can
not
perc
eive
any
vio
latio
n of
free
dom
of e
stab
lishm
ent,
and
that
it is
legi
timat
e to
fix
fees
for r
easo
ns s
uch
as c
onsu
mer
pro
tect
ion
and
qual
ity a
ssur
ance
. The
ora
l he
arin
g in
thes
e pr
ocee
ding
s w
ill ta
ke p
lace
at t
he E
urop
ean
Cour
t of J
ustic
e on
7
Nov
embe
r 201
8.
The
prov
isio
ns o
f the
or
dina
nce
on fe
es
for t
ax a
dvis
ers
wer
e am
ende
d by
Art
icle
9
of th
e Th
ird O
rdin
ance
A
men
ding
Tax
Reg
u-la
tions
of 1
8 Ju
ly 2
016
(Fed
eral
Law
Gaz
ette
I,
p. 1
722)
.
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
2: L
abou
r pa
rtic
ipat
ion
and
labo
ur m
arke
t
redu
ces
disi
ncen
tive
s to
wor
k m
ore
hour
s, in
clud
ing
the
high
ta
x w
edge
, in
part
icul
ar fo
r low
-w
age
and
seco
nd e
arne
rs;
Act
to C
omba
t Tax
Av
oida
nce
(Ste
ueru
mge
hung
s-be
käm
pfun
gsge
setz
)
In th
e ar
ea o
f tax
atio
n, fu
rthe
r wor
k is
bei
ng d
one
to ra
ise
the
profi
le o
f the
fa
ctor
-bas
ed m
etho
d us
ed in
tax
brac
ket I
V. B
y di
strib
utin
g th
e ta
x re
lief b
etw
een
both
ear
ners
, the
fact
or-b
ased
met
hod
help
s to
exp
and
the
supp
ly o
f lab
our.
With
ef
fect
from
1 Ja
nuar
y 20
19, t
he fa
ctor
can
be
set,
on re
ques
t, fo
r tw
o ye
ars
inst
ead
of ju
st fo
r one
yea
r. Si
nce
the
star
t of 2
018,
the
IV/I
V ta
x br
acke
t com
bina
tion
has
beco
me
the
stan
dard
tax
brac
ket f
or m
arrie
d co
uple
s an
d it
is p
ossi
ble
to
chan
ge fr
om th
e op
tiona
l III
/V ta
x br
acke
t com
bina
tion
to th
e IV
/IV
tax
brac
ket
com
bina
tion
at th
e re
ques
t of o
nly
one
spou
se.
Effe
ctiv
e as
from
1
Janu
ary
2018
(F
eder
al L
aw G
azet
te I,
p.
168
2).
Pay
Tran
spar
ency
Act
(Ent
gelt-
tran
spar
enzg
eset
z)
Intr
oduc
tion
of th
e in
divi
dual
righ
t to
be in
form
ed a
nd o
f rep
ortin
g re
quire
men
ts
for l
arge
com
pani
es to
allo
w fo
r gre
ater
tran
spar
ency
on
gend
er-s
peci
fic
rem
uner
atio
n st
ruct
ures
. The
aim
is to
hel
p en
forc
e th
e pr
inci
ple
of e
qual
pay
for
equa
l or e
quiv
alen
t wor
k.
The
Act
ent
ered
into
fo
rce
on 6
July
201
7.
The
first
eva
luat
ion
repo
rt w
ill b
e pr
esen
ted
in Ju
ly 2
019.
Fam
ily T
ax B
urde
n Re
duct
ion
Act
(Fam
ilien
-en
tlast
ungs
gese
tz)
Redu
ctio
ns in
taxe
s an
d co
ntrib
utio
ns s
erve
to in
crea
se in
cent
ives
to w
ork
and
rais
e di
spos
able
inco
mes
, esp
ecia
lly fo
r fam
ilies
and
low
er a
nd m
iddl
e in
com
e gr
oups
.
The
mea
sure
s en
visa
ged
in th
e Fa
mily
Tax
Bur
den
Redu
ctio
n A
ct fo
r 201
9/20
20
(incr
ease
s in
the
basi
c al
low
ance
, chi
ld a
llow
ance
and
chi
ld b
enef
it; o
ffse
ttin
g of
br
acke
t cre
ep) w
ill g
ener
ate
tax
relie
f of a
roun
d €9
.8 b
illio
n pe
r yea
r in
tota
l. W
ith
rega
rd to
the
proc
edur
e to
redu
ce b
rack
et c
reep
and
the
sign
ifica
nt ri
ses
in fa
mily
be
nefit
s in
par
ticul
ar, t
he ta
x m
easu
res
go b
eyon
d w
hat w
as re
quire
d to
mak
e th
e sy
stem
com
ply
with
con
stitu
tiona
l law
.
Taxa
ble
pers
ons
with
low
er a
nd m
iddl
e in
com
es w
ill re
ceiv
e a
muc
h hi
gher
leve
l of
tax
relie
f tha
n ta
xabl
e pe
rson
s w
ith h
ighe
r inc
omes
.
Cabi
net d
ecis
ion:
27
June
201
8.
2018
Ord
inan
ce o
n th
e Co
ntrib
utio
n Ra
te fo
r Sta
tuto
ry
Pens
ion
Insu
ranc
e (B
eitr
agss
atz-
vero
rd-
nung
201
8 fü
r GRV
)
The
cont
ribut
ion
rate
to th
e st
atut
ory
pens
ion
insu
ranc
e sy
stem
dro
pped
by
0.
1 pe
rcen
tage
poi
nts
to 1
8.6%
with
eff
ect f
rom
1 Ja
nuar
y 20
18.
Als
o, th
e ar
ithm
etic
al a
vera
ge a
dditi
onal
con
trib
utio
n ra
te o
f the
sta
tuto
ry h
ealth
in
sura
nce
fund
s fe
ll in
201
8 to
1.0
7%.
Cabi
net d
ecis
ion
(sta
tuto
ry p
ensi
on
insu
ranc
e):
22 N
ovem
ber 2
017.
PAGE 26 Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
2: L
abou
r pa
rtic
ipat
ion
and
labo
ur m
arke
t
and
redu
ctio
n in
the
addi
tiona
l con
trib
u-tio
n ra
te fo
r sta
tuto
ry
heal
th in
sura
nce
Dra
ft A
ct to
Red
uce
Stat
utor
y H
ealth
In
sura
nce
Cont
ribu-
tions
Pai
d by
Insu
red
Pers
ons
(G
KV-V
ersic
hert
en-
entla
stun
gsge
setz
, G
KV-V
EG)
The
GK
V-V
EG p
rovi
des
for a
n av
erag
e re
duct
ion
of 0
.5 p
erce
ntag
e po
ints
in
cont
ribut
ions
for e
mpl
oyee
s an
d pe
nsio
ners
thro
ugh
the
rein
trod
uctio
n of
the
rule
re
quiri
ng e
mpl
oyer
s an
d em
ploy
ees
to p
ay e
qual
con
trib
utio
ns to
sta
tuto
ry h
ealth
in
sura
nce
(equ
al fi
nanc
ing
of th
e ad
ditio
nal c
ontr
ibut
ion;
see
abo
ve re
gard
ing
the
aver
age
addi
tiona
l con
trib
utio
n ra
te in
201
8). T
his
will
relie
ve th
e bu
rden
on
both
em
ploy
ees
and
pens
ione
rs b
y ju
st u
nder
€7
billi
on fr
om
1 Ja
nuar
y 20
19.
Plan
ned
entr
y in
to
forc
e: 1
Janu
ary
2019
.
Act
to Im
prov
e Be
n-ef
its in
and
Sta
bilis
e th
e St
atut
ory
Pens
ion
Insu
ranc
e Sc
hem
e
(RV-
Leist
ungs
ver-
bess
erun
gs- u
nd
Stab
ilisie
rung
sges
etz)
Low
-inc
ome
earn
ers
are
gran
ted
grea
ter r
educ
tions
in s
ocia
l sec
urity
con
trib
u-tio
ns/g
rant
ed re
duct
ions
for t
he fi
rst t
ime:
from
1 Ja
nuar
y 20
19, t
he e
xist
ing
slid
ing
scal
e w
ill b
e ex
pand
ed to
incl
ude
wag
es fr
om €
450.
01 to
€1,
300
(pre
viou
sly
€850
) and
act
as
a tr
ansi
tiona
l sca
le fo
r em
ploy
men
t sub
ject
to s
ocia
l sec
urity
co
ntrib
utio
ns. I
n ad
ditio
n, th
e re
duce
d pe
nsio
n co
ntrib
utio
ns w
ill n
o lo
nger
lead
to
low
er p
ensi
on e
ntitl
emen
ts. U
p to
3.5
mill
ion
empl
oyee
s w
ill b
enef
it fr
om th
is.
For e
xam
ple,
an
empl
oyee
with
a g
ross
mon
thly
wag
e of
€85
0 w
ill in
futu
re b
e be
tter
off
by
€22.
51 p
er m
onth
or a
roun
d €2
70 p
er y
ear.
Und
er th
is a
ct, t
he c
ontr
ibut
ion
rate
to th
e st
atut
ory
pens
ion
insu
ranc
e sc
hem
e of
18
.6%
will
con
tinue
to a
pply
in 2
019.
Cabi
net d
ecis
ion:
29
Aug
ust 2
018.
Plan
ned
entr
y in
to
forc
e: 1
Janu
ary
2019
.
Skill
s D
evel
opm
ent
Opp
ortu
nitie
s Act
an
d O
rdin
ance
on
the
cont
ribut
ion
rate
fo
r sta
tuto
ry p
ensi
on
insu
ranc
e to
redu
ce
the
cont
ribut
ion
rate
s to
une
mpl
oy-
men
t ins
uran
ce
The
cont
ribut
ion
rate
to u
nem
ploy
men
t ins
uran
ce is
to b
e re
duce
d by
0.5
pe
rcen
tage
poi
nts
as o
f 1 Ja
nuar
y 20
19.
Cabi
net d
ecis
ion:
19
Sep
tem
ber 2
018.
Subj
ect t
o pa
rliam
en-
tary
pro
cedu
re, e
ntry
in
to fo
rce
on
1 Ja
nuar
y 20
19.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 27Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
2: L
abou
r pa
rtic
ipat
ion
and
labo
ur m
arke
t
and
redu
ctio
n in
the
addi
tiona
l con
trib
u-tio
n ra
te fo
r sta
tuto
ry
heal
th in
sura
nce
Dra
ft A
ct to
Red
uce
Stat
utor
y H
ealth
In
sura
nce
Cont
ribu-
tions
Pai
d by
Insu
red
Pers
ons
(G
KV-V
ersic
hert
en-
entla
stun
gsge
setz
, G
KV-V
EG)
The
GK
V-V
EG p
rovi
des
for a
n av
erag
e re
duct
ion
of 0
.5 p
erce
ntag
e po
ints
in
cont
ribut
ions
for e
mpl
oyee
s an
d pe
nsio
ners
thro
ugh
the
rein
trod
uctio
n of
the
rule
re
quiri
ng e
mpl
oyer
s an
d em
ploy
ees
to p
ay e
qual
con
trib
utio
ns to
sta
tuto
ry h
ealth
in
sura
nce
(equ
al fi
nanc
ing
of th
e ad
ditio
nal c
ontr
ibut
ion;
see
abo
ve re
gard
ing
the
aver
age
addi
tiona
l con
trib
utio
n ra
te in
201
8). T
his
will
relie
ve th
e bu
rden
on
both
em
ploy
ees
and
pens
ione
rs b
y ju
st u
nder
€7
billi
on fr
om
1 Ja
nuar
y 20
19.
Plan
ned
entr
y in
to
forc
e: 1
Janu
ary
2019
.
Act
to Im
prov
e Be
n-ef
its in
and
Sta
bilis
e th
e St
atut
ory
Pens
ion
Insu
ranc
e Sc
hem
e
(RV-
Leist
ungs
ver-
bess
erun
gs- u
nd
Stab
ilisie
rung
sges
etz)
Low
-inc
ome
earn
ers
are
gran
ted
grea
ter r
educ
tions
in s
ocia
l sec
urity
con
trib
u-tio
ns/g
rant
ed re
duct
ions
for t
he fi
rst t
ime:
from
1 Ja
nuar
y 20
19, t
he e
xist
ing
slid
ing
scal
e w
ill b
e ex
pand
ed to
incl
ude
wag
es fr
om €
450.
01 to
€1,
300
(pre
viou
sly
€850
) and
act
as
a tr
ansi
tiona
l sca
le fo
r em
ploy
men
t sub
ject
to s
ocia
l sec
urity
co
ntrib
utio
ns. I
n ad
ditio
n, th
e re
duce
d pe
nsio
n co
ntrib
utio
ns w
ill n
o lo
nger
lead
to
low
er p
ensi
on e
ntitl
emen
ts. U
p to
3.5
mill
ion
empl
oyee
s w
ill b
enef
it fr
om th
is.
For e
xam
ple,
an
empl
oyee
with
a g
ross
mon
thly
wag
e of
€85
0 w
ill in
futu
re b
e be
tter
off
by
€22.
51 p
er m
onth
or a
roun
d €2
70 p
er y
ear.
Und
er th
is a
ct, t
he c
ontr
ibut
ion
rate
to th
e st
atut
ory
pens
ion
insu
ranc
e sc
hem
e of
18
.6%
will
con
tinue
to a
pply
in 2
019.
Cabi
net d
ecis
ion:
29
Aug
ust 2
018.
Plan
ned
entr
y in
to
forc
e: 1
Janu
ary
2019
.
Skill
s D
evel
opm
ent
Opp
ortu
nitie
s Act
an
d O
rdin
ance
on
the
cont
ribut
ion
rate
fo
r sta
tuto
ry p
ensi
on
insu
ranc
e to
redu
ce
the
cont
ribut
ion
rate
s to
une
mpl
oy-
men
t ins
uran
ce
The
cont
ribut
ion
rate
to u
nem
ploy
men
t ins
uran
ce is
to b
e re
duce
d by
0.5
pe
rcen
tage
poi
nts
as o
f 1 Ja
nuar
y 20
19.
Cabi
net d
ecis
ion:
19
Sep
tem
ber 2
018.
Subj
ect t
o pa
rliam
en-
tary
pro
cedu
re, e
ntry
in
to fo
rce
on
1 Ja
nuar
y 20
19.
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
2: L
abou
r pa
rtic
ipat
ion
and
labo
ur m
arke
t
Calls
to re
duce
soc
ial s
ecur
ity c
ontr
ibut
ions
mus
t bea
r in
min
d th
at c
ontr
ibut
ions
to
soci
al s
ecur
ity fu
nds
are
coun
terb
alan
ced
by c
orre
spon
ding
ser
vice
s, so
me
of w
hich
ar
e eq
uiva
lent
to th
e co
ntrib
utio
ns, f
rom
the
soci
al s
ecur
ity s
yste
ms
(prin
cipl
e th
at
cont
ribut
ions
mus
t be
equa
l to
bene
fits)
, and
that
it is
nec
essa
ry to
avo
id re
duce
d be
nefit
ent
itlem
ents
for l
ow in
com
e ea
rner
s in
par
ticul
ar.
Nev
erth
eles
s, lim
iting
the
burd
en o
f tax
es a
nd s
ocia
l sec
urity
con
trib
utio
ns o
n
labo
ur in
a w
ay th
at is
pro
-gro
wth
and
pro
-em
ploy
men
t rem
ains
an
impo
rtan
t ov
eral
l pol
icy
goal
for t
he fe
dera
l gov
ernm
ent.
In th
e in
tere
st o
f em
ploy
ees
and
empl
oyer
s, th
e fe
dera
l gov
ernm
ent s
eeks
to k
eep
soci
al s
ecur
ity c
ontr
ibut
ions
sta
ble
at u
nder
40%
of i
ncom
e lia
ble
to s
ocia
l sec
urity
con
trib
utio
ns.
take
s m
easu
res
to p
rom
ote
long
er w
orki
ng li
ves;
The
posi
tive
deve
lopm
ent o
f the
labo
ur fo
rce
part
icip
atio
n ra
te a
mon
gst o
lder
pe
ople
in th
e la
st d
ecad
e sh
ows
that
ther
e ar
e ve
ry e
ffec
tive
ince
ntiv
es fo
r lat
er re
-tir
emen
t. Th
ese
ince
ntiv
es w
ill b
e ke
pt in
pla
ce a
s th
ey a
re n
eede
d –
not l
east
aga
inst
th
e ba
ckgr
ound
of t
he fa
r-re
achi
ng d
emog
raph
ic c
hang
e –
in o
rder
to m
aint
ain
the
stab
ility
of t
he p
ensi
on in
sura
nce.
The
rais
ing
of th
e st
atut
ory
retir
emen
t age
to 6
7 an
d th
e ra
isin
g of
the
retir
emen
t ag
e fo
r oth
er ty
pes
of p
ensi
on a
re s
how
ing
an im
pact
.
The
Act
to F
lexi
bilis
e th
e Tr
ansi
tion
from
Wor
king
Life
to R
etire
men
t and
to
Stre
ngth
en P
reve
ntio
n an
d Re
habi
litat
ion
in W
orki
ng L
ife (G
eset
z zu
r Fle
xibi
lisie
rung
de
s Ü
berg
angs
vom
Erw
erbs
lebe
n in
den
Ruh
esta
nd u
nd z
ur S
tärk
ung
von
Präv
en-
tion
und
Reha
bilit
atio
n im
Erw
erbs
lebe
n), w
hich
ent
ered
into
forc
e in
201
7, c
an h
elp
to e
nsur
e th
at th
e po
sitiv
e em
ploy
men
t tre
nd a
mon
gst o
lder
wor
kers
con
tinue
s. Th
anks
to th
e in
trod
uctio
n of
a n
ew ru
le fo
r sup
plem
enta
ry e
arni
ngs
to b
e co
unte
d pr
ogre
ssiv
ely,
it is
now
pos
sibl
e to
com
bine
gai
nful
act
ivity
and
par
tial p
ensi
on m
ore
flexi
bly
than
bef
ore.
The
ext
ent t
o w
hich
the
new
act
is le
adin
g th
e la
bour
forc
e pa
rtic
ipat
ion
amon
g ol
der p
eopl
e to
rise
will
be
asse
ssed
aft
er 5
yea
rs.
crea
tes
cond
ition
s to
pro
mot
e hi
gher
wag
e gr
owth
, whi
le
resp
ectin
g th
e ro
le o
f the
soc
ial
part
ners
;
Ger
man
y ha
s a
syst
em o
f fre
e co
llect
ive
barg
aini
ng, i
.e. t
he p
artie
s to
free
col
lect
ive
barg
aini
ng a
re re
spon
sibl
e fo
r stip
ulat
ing
wag
es a
nd s
alar
ies.
In p
rinci
ple,
the
stat
e do
es n
ot in
fluen
ce th
is.
PAGE 28 Ta
ble
10:
cont
inua
tion
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
2: L
abou
r pa
rtic
ipat
ion
and
labo
ur m
arke
t
Rega
rdin
g th
e de
velo
pmen
t of r
eal w
ages
in G
erm
any:
The
real
wag
e in
dex
of th
e Fe
dera
l Sta
tistic
al O
ffic
e in
dica
tes
an a
nnua
l ave
rage
incr
ease
of 1
.3%
for t
he 2
010-
2016
per
iod,
bas
ed o
n gr
oss
mon
thly
wag
es; i
n 20
15, t
he lo
w in
flatio
n ra
te m
eant
th
at th
e gr
owth
in re
al w
ages
was
as
high
as
2.4%
; the
201
6 fig
ure
was
1.8
%.
Third
Ord
inan
ce o
n a
min
imum
wag
e fo
r te
mpo
rary
wor
kers
The
ordi
nanc
e w
as e
nact
ed o
n th
e ba
sis
of a
pro
posa
l by
the
part
ies
to fr
ee
colle
ctiv
e ba
rgai
ning
in th
e fie
ld o
f tem
pora
ry w
orke
rs in
acc
orda
nce
with
Sec
tion
3a o
f the
Act
on
Tem
pora
ry E
mpl
oym
ent.
The
min
imum
wag
es s
tipul
ated
in th
e or
dina
nce
appl
y to
all
empl
oyer
s an
d te
mpo
rary
wor
kers
cov
ered
by
the
ordi
nanc
e.
The
ordi
nanc
e en
tere
d in
to fo
rce
on
1 Ju
ne 2
017
(exp
ires:
31
Dec
embe
r 201
9).
Third
Ord
inan
ce o
n w
orki
ng c
ondi
tions
in
long
-ter
m c
are
(Lon
g-te
rm c
are
min
imum
wag
e or
dina
nce)
The
ordi
nanc
e w
as e
nact
ed o
n th
e ba
sis
of a
pro
posa
l by
the
long
-ter
m c
are
min
imum
wag
e co
mm
issi
on, c
onsi
stin
g of
trad
e un
ions
, em
ploy
ers’
ass
ocia
tions
an
d re
pres
enta
tives
of p
rovi
ders
and
reci
pien
ts o
f soc
ial s
ervi
ces
prov
ided
by
the
Chur
ches
. The
new
Lon
g-te
rm c
are
min
imum
wag
e or
dina
nce
defin
es a
low
est
wag
e le
vel i
n a
sect
or in
whi
ch, d
ue to
spe
cial
str
uctu
ral f
eatu
res,
the
wor
king
co
nditi
ons
are
in m
any
case
s no
t cov
ered
by
colle
ctiv
e ag
reem
ents
; thi
s lo
wes
t w
age
leve
l app
lies
to a
ll pr
ovid
ers
of lo
ng-t
erm
car
e an
d m
ay n
ot b
e un
derc
ut in
an
y ci
rcum
stan
ces.
The
ordi
nanc
e en
tere
d in
to fo
rce
on 1
Nov
embe
r 201
7 (e
xpire
s: 3
0 A
pril
2020
).
impr
oves
edu
cati
onal
out
com
es
and
skill
s le
vels
of d
isad
vant
aged
gr
oups
.
Dra
ft S
kills
Dev
elop
-m
ent O
ppor
tuni
ties
Act
The
Skill
s D
evel
opm
ent O
ppor
tuni
ties A
ct a
ims
to im
prov
e ac
cess
to v
ocat
iona
l ed
ucat
ion
and
trai
ning
and
to b
oost
the
leve
l of s
uppo
rt p
rovi
ded.
The
Act
’s
obje
ctiv
e is
to p
rovi
de e
mpl
oyee
s w
hose
pro
fess
iona
l act
iviti
es c
an b
e re
plac
ed
by te
chno
logy
, who
are
aff
ecte
d by
str
uctu
ral c
hang
e, o
r who
see
k tr
aini
ng in
oc
cupa
tions
aff
ecte
d by
ski
lls s
hort
ages
with
acc
ess
to tr
aini
ng s
uppo
rt fr
om th
e Fe
dera
l Em
ploy
men
t Age
ncy,
irre
spec
tive
of th
e si
ze o
f the
com
pany
they
wor
k fo
r. Su
ppor
t can
be
prov
ided
for e
mpl
oyee
s an
d em
ploy
ers
alik
e. In
the
case
of
unem
ploy
ed p
erso
ns, s
uppo
rt c
an b
e pr
ovid
ed fo
r the
acq
uisi
tion
of ‘e
xten
sion
’ qu
alifi
catio
ns, h
elpi
ng to
impr
ove
chan
ces
of in
tegr
atin
g in
to th
e la
bour
mar
ket.
Cabi
net d
ecis
ion
of
19 S
epte
mbe
r 201
8.
Subj
ect t
o pa
rliam
en-
tary
pro
cedu
re fo
r the
pr
ovis
ion
on a
dvan
ced
voca
tiona
l tra
inin
g,
entr
y in
to fo
rce
on
1 Ja
nuar
y 20
19.
Nat
iona
l str
ateg
y fo
r ad
vanc
ed e
duca
tion
and
trai
ning
The
Fede
ral M
inis
try
of L
abou
r and
Soc
ial A
ffai
rs a
nd th
e Fe
dera
l Min
istr
y of
Ed
ucat
ion
and
Rese
arch
are
cur
rent
ly p
repa
ring
to e
stab
lish
a ne
w c
omm
ittee
to
dev
elop
a n
atio
nal s
trat
egy
for a
dvan
ced
educ
atio
n an
d tr
aini
ng. T
he o
peni
ng
conf
eren
ce, i
nvol
ving
the
soci
al p
artn
ers
and
the
Länd
er, w
ill ta
ke p
lace
on
12
Nov
embe
r 201
8. O
ne o
f the
aim
s is
to p
ool a
ll fe
dera
l and
Lan
d ad
vanc
ed
educ
atio
n an
d tr
aini
ng p
rogr
amm
es, t
o ge
ar th
em to
war
ds e
mpl
oyee
and
com
pany
ne
eds,
and
to e
stab
lish
a ne
w c
ultu
re o
f adv
ance
d ed
ucat
ion
and
trai
ning
.
Ope
ning
con
fere
nce
on 1
2 N
ovem
ber 2
018
(dur
atio
n: w
hole
of
the
curr
ent l
egis
lativ
e te
rm).
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 29
National headline targets for 2020 List of actions* Description of the direct
relevance to the target
Employment rate among persons aged 20–64: 77%**
Employment rate among older persons aged 55–64: 60%**
Employment rate among women: 73%**
No changes compared with the 2018 NRP.
R&D expenditure: 3% of GDP (two-thirds from the private sector and one-third from the public sector)
The “High-Tech Strategy 2025” is an interdepartmental research and innovation strategy that was adopted by the federal cabinet on 5 September 2018. By linking funding for technology with education and training opportunities, it aims to help people prepare for impending technology-related changes. Targeted measures will facilitate the transfer of basic research into the application phase. To this end, the High-Tech Strategy 2025 aims to establish an open culture of innovation that integrates new knowledge and new stakeholders into cutting-edge projects and that provides space for creative ideas.
In addition, on 29 August 2018, the federal government took the decision to establish an agency to promote breakthrough innovations. This agency’s approach to innovation promotion will be people-centred in a way that has never been tried before in Germany: specifically, it will place a resolute focus on making the shift from R&D to application, providing innovators from the fields of science and business with the trust and independence to turn highly innovative ideas into application-ready products, processes and services.
Reduce greenhouse gas emissions by at least 40% by 2020 by 80–95% by 2050, compared with 1990 levels
Increase share of renewable energy to 18% of gross final energy consumption by 2020, to 60% by 2050 and to at least 80% in the electricity sector
An efficient power grid is an essential part of Germany’s Energiewende and needs to be better coordinated with the expansion of renewable energy. Germany is pursuing a dual strategy that aims to (a) optimise existing networks and get them to operate at maximum capacity while simultaneously (b) making faster progress in expanding and upgrading the power grid.
The Coalition Agreement aims to increase the share of electricity from renewable energy sources (from 50% currently) to 65% of gross electricity consumption by 2030. This can only be achieved if renewable energy continues to be expanded in an ambitious, efficient, increasingly market-oriented manner and with grid synchronisation. The challenge consists in ensuring improved synchro-nisation between renewable energy and grid capacities.
Table 11: Targets of the EU’s strategy for growth and jobs
The
Coun
cil o
f the
Eur
opea
n U
nion
reco
mm
ends
that
G
erm
any
in 2
018
and
2019
Titl
e of
mea
sure
D
escr
ipti
on a
nd e
xpec
ted
impa
ct o
f mea
sure
Stat
us a
nd ti
met
able
Reco
mm
enda
tion
2: L
abou
r pa
rtic
ipat
ion
and
labo
ur m
arke
t
Rega
rdin
g th
e de
velo
pmen
t of r
eal w
ages
in G
erm
any:
The
real
wag
e in
dex
of th
e Fe
dera
l Sta
tistic
al O
ffic
e in
dica
tes
an a
nnua
l ave
rage
incr
ease
of 1
.3%
for t
he 2
010-
2016
per
iod,
bas
ed o
n gr
oss
mon
thly
wag
es; i
n 20
15, t
he lo
w in
flatio
n ra
te m
eant
th
at th
e gr
owth
in re
al w
ages
was
as
high
as
2.4%
; the
201
6 fig
ure
was
1.8
%.
Third
Ord
inan
ce o
n a
min
imum
wag
e fo
r te
mpo
rary
wor
kers
The
ordi
nanc
e w
as e
nact
ed o
n th
e ba
sis
of a
pro
posa
l by
the
part
ies
to fr
ee
colle
ctiv
e ba
rgai
ning
in th
e fie
ld o
f tem
pora
ry w
orke
rs in
acc
orda
nce
with
Sec
tion
3a o
f the
Act
on
Tem
pora
ry E
mpl
oym
ent.
The
min
imum
wag
es s
tipul
ated
in th
e or
dina
nce
appl
y to
all
empl
oyer
s an
d te
mpo
rary
wor
kers
cov
ered
by
the
ordi
nanc
e.
The
ordi
nanc
e en
tere
d in
to fo
rce
on
1 Ju
ne 2
017
(exp
ires:
31
Dec
embe
r 201
9).
Third
Ord
inan
ce o
n w
orki
ng c
ondi
tions
in
long
-ter
m c
are
(Lon
g-te
rm c
are
min
imum
wag
e or
dina
nce)
The
ordi
nanc
e w
as e
nact
ed o
n th
e ba
sis
of a
pro
posa
l by
the
long
-ter
m c
are
min
imum
wag
e co
mm
issi
on, c
onsi
stin
g of
trad
e un
ions
, em
ploy
ers’
ass
ocia
tions
an
d re
pres
enta
tives
of p
rovi
ders
and
reci
pien
ts o
f soc
ial s
ervi
ces
prov
ided
by
the
Chur
ches
. The
new
Lon
g-te
rm c
are
min
imum
wag
e or
dina
nce
defin
es a
low
est
wag
e le
vel i
n a
sect
or in
whi
ch, d
ue to
spe
cial
str
uctu
ral f
eatu
res,
the
wor
king
co
nditi
ons
are
in m
any
case
s no
t cov
ered
by
colle
ctiv
e ag
reem
ents
; thi
s lo
wes
t w
age
leve
l app
lies
to a
ll pr
ovid
ers
of lo
ng-t
erm
car
e an
d m
ay n
ot b
e un
derc
ut in
an
y ci
rcum
stan
ces.
The
ordi
nanc
e en
tere
d in
to fo
rce
on 1
Nov
embe
r 201
7 (e
xpire
s: 3
0 A
pril
2020
).
impr
oves
edu
cati
onal
out
com
es
and
skill
s le
vels
of d
isad
vant
aged
gr
oups
.
Dra
ft S
kills
Dev
elop
-m
ent O
ppor
tuni
ties
Act
The
Skill
s D
evel
opm
ent O
ppor
tuni
ties A
ct a
ims
to im
prov
e ac
cess
to v
ocat
iona
l ed
ucat
ion
and
trai
ning
and
to b
oost
the
leve
l of s
uppo
rt p
rovi
ded.
The
Act
’s
obje
ctiv
e is
to p
rovi
de e
mpl
oyee
s w
hose
pro
fess
iona
l act
iviti
es c
an b
e re
plac
ed
by te
chno
logy
, who
are
aff
ecte
d by
str
uctu
ral c
hang
e, o
r who
see
k tr
aini
ng in
oc
cupa
tions
aff
ecte
d by
ski
lls s
hort
ages
with
acc
ess
to tr
aini
ng s
uppo
rt fr
om th
e Fe
dera
l Em
ploy
men
t Age
ncy,
irre
spec
tive
of th
e si
ze o
f the
com
pany
they
wor
k fo
r. Su
ppor
t can
be
prov
ided
for e
mpl
oyee
s an
d em
ploy
ers
alik
e. In
the
case
of
unem
ploy
ed p
erso
ns, s
uppo
rt c
an b
e pr
ovid
ed fo
r the
acq
uisi
tion
of ‘e
xten
sion
’ qu
alifi
catio
ns, h
elpi
ng to
impr
ove
chan
ces
of in
tegr
atin
g in
to th
e la
bour
mar
ket.
Cabi
net d
ecis
ion
of
19 S
epte
mbe
r 201
8.
Subj
ect t
o pa
rliam
en-
tary
pro
cedu
re fo
r the
pr
ovis
ion
on a
dvan
ced
voca
tiona
l tra
inin
g,
entr
y in
to fo
rce
on
1 Ja
nuar
y 20
19.
Nat
iona
l str
ateg
y fo
r ad
vanc
ed e
duca
tion
and
trai
ning
The
Fede
ral M
inis
try
of L
abou
r and
Soc
ial A
ffai
rs a
nd th
e Fe
dera
l Min
istr
y of
Ed
ucat
ion
and
Rese
arch
are
cur
rent
ly p
repa
ring
to e
stab
lish
a ne
w c
omm
ittee
to
dev
elop
a n
atio
nal s
trat
egy
for a
dvan
ced
educ
atio
n an
d tr
aini
ng. T
he o
peni
ng
conf
eren
ce, i
nvol
ving
the
soci
al p
artn
ers
and
the
Länd
er, w
ill ta
ke p
lace
on
12
Nov
embe
r 201
8. O
ne o
f the
aim
s is
to p
ool a
ll fe
dera
l and
Lan
d ad
vanc
ed
educ
atio
n an
d tr
aini
ng p
rogr
amm
es, t
o ge
ar th
em to
war
ds e
mpl
oyee
and
com
pany
ne
eds,
and
to e
stab
lish
a ne
w c
ultu
re o
f adv
ance
d ed
ucat
ion
and
trai
ning
.
Ope
ning
con
fere
nce
on 1
2 N
ovem
ber 2
018
(dur
atio
n: w
hole
of
the
curr
ent l
egis
lativ
e te
rm).
PAGE 30
Table 11: continuation
National headline targets for 2020 List of actions* Description of the direct
relevance to the target
National energy efficiency goals under the Federal Government's energy strategy of 28 September 2010: reduce primary energy consumption by 20% by 2020 and by 50% by 2050, compared with 2008 levels
The Federation and Länder have agreed on a package of measures to expedite grid expansion:
• revision of the Grid Expansion Acceleration Act (Netzausbaubeschleunigungsgesetz) with the aim of simplifying and streamlining procedures
• targets for concluding licensing procedures
• forward-looking control procedures
In the area of energy efficiency, the Federation intends to:
• formulate a long-term, cross-sectoral energy efficiency strategy and update Germany’s National Energy Efficiency Action Plan
• simplify regulatory law and make it less bureaucratic; this includes merging the provisions of the Energy Conservation Act, the Energy Conservation Ordinance and the Renewable Energies Heat Act into a state-of-the-art Building Energy Act (Gebäudeenergiegesetz)
• continue implementing its support strategy
• continue its successful support for energy efficiency measures and for the use of renewable energy in the building sector (including the CO2 Building Refurbishment Programme, the Market Incentives Programme, and other programmes in other sectors)
• the Coalition Agreement calls for a supplementary tax incentive to promote energy-efficient building refurbishment; a decision on this issue has not yet been taken
A 50% reduction of primary energy consumption by 2050, compared with 2008 levels, would allow for climate targets to be achieved at an affordable cost. In order to achieve this extremely challenging goal, significant progress must be made in all relevant sectors. For this reason, Germany’s energy efficiency strategy will take a cross-sectoral approach and will identify and pool the necessary measures and instruments. The strategy will be oriented towards an overall vision for the period until 2050, though it will first focus on the medium term, planning for the period until 2030. In this, compiling effective, cost-efficient instruments in a National Action Plan on Energy Efficiency 2.0 will play a central role. In addition, it is intended that the “efficiency first” principle be firmly established.
With the Building Energy Act, the requirements of the EU Buildings Directive will be implemented for public non-residential buildings as of 1 January 2019 and for all buildings as of 1 January 2021; the current energy requirements will continue to apply to new and existing buildings. A neighbourhood-based approach will be introduced.
Increase in the share of persons aged 30-34 who have completed tertiary education or equivalent-to 42%**
The third phase of the Higher Education Pact will see the Federation and the Länder provide courses for an additional 760,033 new students (compared to the 2005 figures) by 2020.
The goal of the 2020 Higher Education Pact is to protect study opportunities for young people and to ensure that the new generation of academics and researchers that is needed can form.
GERMAN DRAFT BUDGETARY PLAN 2019 PAGE 31
Table 11: continuation
National headline targets for 2020 List of actions* Description of the direct
relevance to the target
In total, and including financing until 2023, higher education institutions will receive over €20 billion from the Federation and €18 billion from the Länder over the entire course of all three phases of the Higher Education Pact, which began in 2007.
The Quality Pact for Teaching is currently helping 156 higher education institutions improve support for students as well as the quality of teaching. The Federation has provided €1 billion for this programme for the 2011-2020 period.
In the fiscal years 2019-2021, the Federation will provide an additional €1 billion in total for the revision of the Federal Education and Training Assistance Act (Bundesausbildungsförderungsgesetz).
In this, the aim is to meet the labour market’s growing demand for skilled workers and to ensure high-quality higher education.
The Quality Pact for Teaching makes a contribution to lowering dropout rates in higher education.
Reduce the number of long-term unemployed persons
by 20% by 2020 compared with 2008 levels**
Inclusion Act (Teilhabechancengesetz) with two new instruments – “Integrating the long-term unemployed” (section 16e-amended) and “Inclusion in the labour market” (section 16i) – introduced into Book II of the Social Code.
Cabinet decision: 18 July 2018
Planned entry into force: 1 January 2019
The goal is to give the long-term unemployed specific employment options on the general and social labour markets. Jobs subject to social security contributions, with all types of employers, are promoted with the help of a subsidy for wages costs.
Over the 2018-2022 period, the overall approach in which these two new instruments are embedded will receive an additional €4 billion from the Federation as part of the reintegration budget. The 2019 tranche is €900 million.
* The 2018 NRP, which was sent to the European Commission in April 2018, includes a comprehensive overview of the state of play re-garding the implementation of the Europe 2020 strategy in Germany, including a detailed table of actions (including description of action, anticipated impact, status and schedule), p. 54 et seqq. The overview in this table is limited to new actions (planned, adopted, in force), especially actions affecting public finances, which will take effect in 2019 and the following years.** Target already met.
PAGE 32
Relevant step of the budgetary process
Relevant features of the model/technique used
Assumptions Assumptions
Macroeconomic forecast
Before each tax estimation
Iterative-analytic approach: several partial models are used in the system of national accounts. Potential GDP is estimated on the basis of models developed and recommended by the Output Gap Working Group of the European Union’s Economic Policy Committee (EPC).
Technical assumptions (for oil and commodity prices, exchange rates and interest).
Tax revenue estimate Basis for drafting and finalising budget
Estimate based on macroeconomic forecast and time series analysis
Macroeconomic forecast, estimates on the fiscal impact of discretionary tax measures
Fiscal impact of discretionary tax measures
Basis for tax revenue estimate and for drafting and finalising budget
Microsimulation models based on tax statistics; calculations based on macroeconomic assumptions
Macroeconomic forecast
Table 12: Methodological aspects
Published byFederal Ministry of FinancePublic Relations DivisionWilhelmstr. 9710117 Berlin, Germany
Publication DateOctober 2018
Edited byReferat I A 4
Where to order this publication:Tel: +49 3018 272 2721Fax: +49 3018 10 272 2721email: [email protected]
Further information can be found online at:www.bundesfinanzministerium.dewww.ministere-federal-des-finances.dewww.federal-ministry-of-finance.de
www.stabile-haushalte.de
