By Maria Martinez
BERLIN (Reuters) – Germany’s federal and regional state governments’ tax revenue rose strongly in June compared with the same month last year, the finance ministry said on Tuesday.
The federal and state governments’ tax revenue increased by 6.2% year-on-year to a total of 91.7 billion euros ($99.85 billion) in June, according to the ministry’s monthly report.
The tax revenue rose by 3.6% in January through June, when compared with the same period last year, and reached 414.0 billion euros.
The tax incomes are expected to increase throughout the year as inflation continues its downward trend and consumers gain purchasing power, which would be positive for sales taxes.
For full-year 2024, analysts forecast tax revenue will increase to 863.68 billion euros, up 4.1% from the previous year, according to the report.
The economy is expected to pick up steam in the second half of the year, following a sluggish first half.
Last week the German cabinet passed an economic package that aims to rev up the euro zone’s biggest economy and boost growth by more than half a percentage point in 2025.
Stronger economic growth thanks to the economic package should generate additional revenue of 6 billion euros next year, according to the estimates of the economy ministry.
“In wage and income tax, we are providing considerable relief in the order of 23 billion euros over the next two years,” German Finance Minister Christian Lindner said in the monthly report, referring to the 2025 budget passed by the coalition last week.
“In the next few weeks, we will draw up the other laws to implement the growth initiative and also pass them, for example the Annual Tax Act 2024 in July, which contains many of the tax measures to dynamise the economy,” Lindner said.
($1 = 0.9184 euro)