Hardened fronts
Traffic light pushes for agreement on growth package
February 20, 2024, 5:33 p.m
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The Federal Council is blocking the Growth Opportunities Act and it is now stuck in a mediation process between the Bundestag and the state chamber. A mediation committee will soon negotiate the implementation. The SPD, Greens and FDP are hoping for a quick decision.
Before the negotiations in the mediation committee of the Federal Council and Bundestag on the traffic light growth package, positions had hardened. The Union only wants to agree to the law if the SPD, Greens and FDP forego the planned cancellation of the tax break for agricultural diesel. Chancellor Olaf Scholz called for a quick agreement. It would be good if the Growth Opportunities Act were passed quickly despite all the political conflicts, said the SPD politician at an event organized by employers’ associations in Berlin. It would bring relief for small and large companies.
Federal Economics Minister Robert Habeck also pushed for an agreement. “That has to happen now,” said the Green politician. The Growth Opportunities Act is intended, among other things, to bring tax relief for companies. However, the Federal Council blocked the project on the grounds that the states would have to bear a large part of the costs. That’s why the law is currently in the mediation process – the mediation committee is meeting this Wednesday. The volume of relief in this process is expected to fall from the previously planned seven billion euros annually to three billion euros.
Union parliamentary group leader Friedrich Merz calculated that the federal government would still have tax losses of around 1.5 billion euros. “We are against the fact that these tax losses are financed through tax increases amounting to around 500 million euros at the expense of farmers,” said the CDU chairman. “We are not prepared to accept that some are burdened so that others can be relieved. The two belong together.”
“Opened the door”
The chairman of the CSU MPs, Alexander Dobrindt, called the one-sided burden on agriculture completely excessive. “We have opened the door. It is possible to reach an agreement,” said Dobrindt at the meeting of the mediation committee. Counterfinancing the 1.5 billion euro costs for the federal government by half a billion tax increases for agriculture is completely disproportionate. “And that’s why this tax increase on agriculture simply has to be reversed. Then there will be an agreement at this point.”
Economics Minister Habeck said the law could only be a partial answer to the need to stimulate investment in Germany. Given the budget situation, it was originally supposed to amount to eight billion euros, including contributions from the federal, state and local governments. “Now it has become even smaller, but these impulses should come. And to be honest, they are already coming too late.”
The SPD parliamentary group leader Rolf Mützenich regretted that the Union-led side “approached the talks with such a clear dogma.” We will now explore with agriculture what is still possible in the first half of the year and will meet with the representatives of 31 associations this Wednesday. “I am still very confident that we will ultimately find a solution in the mediation committee. But I will not submit to anyone’s dictates,” emphasized the SPD politician.
Appeal from the FDP
The FDP parliamentary group leader Christian Dürr made a “heartfelt appeal” to the CDU and CSU to give up their blockade based on party politics. In the end, this comes about at the expense of companies and medium-sized businesses.
The Mediation Committee will discuss a total of five laws this Wednesday. In addition to the Growth Opportunities Act, these are the Hospital Transparency Act, the Main Negotiation Documentation Act, the Act to Promote the Use of Video Conferencing Technology in Civil Justice and a Act to Implement an EU Directive on Motor Vehicle Liability Insurance.