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27th Sub­sidy Re­port 2017 - 2020

The Ger­man gov­ern­ment’s work is based on trans­paren­cy and facts. In line with this ap­proach, the Fi­nance Min­istry pre­sent­ed the gov­ern­ment’s 27th Sub­sidy Re­port to the fed­er­al cab­i­net on 6 Novem­ber 2019. Cli­mate ac­tion is an im­por­tant pri­or­i­ty for gov­ern­ment sub­si­dies, with the ma­jor­i­ty of fed­er­al fi­nan­cial as­sis­tance go­ing to en­vi­ron­men­tal and cli­mate-re­lat­ed mea­sures. Oth­er cur­rent fund­ing pri­or­i­ties in­clude mo­bil­i­ty, dig­i­tal tech­nol­o­gy and hous­ing con­struc­tion.
  • Version 03 March 2020
  • Type brochure
  • Product number BMF40263
Cover: 27th Subsidy Report 2017 - 2020
  • Version 03 March 2020
  • Type brochure
  • Product number BMF40263

The Federal Ministry of Finance is obliged by law to present a report every two years to the German Bundestag and Bundesrat on trends in federal financial assistance and tax benefits. Financial assistance refers to federal funds allocated to bodies outside the federal administration, for example to private businesses or economic sectors. Tax benefits, in turn, are defined as special tax exceptions that reduce public revenue.

Subsidy policy is an integral part of the federal government’s forward-looking fiscal policy. It is increasingly being shaped by climate and environmental policies, especially when it comes to financial assistance. For example, 53 grants with a total financing volume of €8.4 billion are directly related to the environmental and climate targets set out in Germany’s sustainability strategy. This means that, in terms of financial assistance, around 58% of the total financing volume is allocated to environmental and climate-related measures. Other current funding priorities include mobility, digital technology and housing construction. It is essential to set clear priorities for subsidies. In this way, the federal government can provide significant stimulus to make the economy more future-proof and innovative, push forward with climate and environmental action, and promote social equity.

Subsidies are subject to regular evaluation in terms of their target attainment, effectiveness and sustainability. During the reporting period, a total of 33 tax benefits related to energy and electricity duty, motor vehicle tax and income tax were evaluated in an external study, which was completed in October 2019. Information on the design of the study and its key findings are included in the 27th Subsidy Report. The research project has made an effective contribution to implementing the government’s subsidy policy guidelines and also helps to strengthen the foundations of evidence-based fiscal policy.