CDU on finance and taxes

The CDU wants to lower the real estate transfer tax in stages to 3.5 percent of the purchase price in order to reduce the extra costs of buying property. At the federal level it wants to secure further tax relief for home ownership.

People pay a tax when they buy a house or apartment. The CDU wants to lower this tax step by step. In the end it should be 3.5 percent of the price. This makes buying cheaper.

At the federal level, loan interest for owner-occupied homes should become tax-deductible. The states should have more freedom in shaping the transfer tax, for example through allowances for families. In addition, a fixed share of climate-related costs for residential buildings should be deductible.

The CDU wants to stabilize municipal finances and secure room for local investment. It points to falling local business tax revenue alongside growing tasks. Planned are additional state funds, higher grants and a larger equalization fund.

Cities and towns should get more money from the state. They take in less tax and have more tasks. The state should pay more for daycare centers. A support fund for towns should grow to 350 million euros.

Advance payments from the fiscal equalization system, additional state funds and targeted back payments are to remain possible, accompanied by regular talks with municipalities. Payments are to be made as lump sums where possible. Grants for daycare centers and investment programs are to rise. The equalization fund is also to grow automatically over time. General allocations are to get an economic-cycle component, and greater weight for land area in municipalities with many districts is under review.

The CDU commits to the Schuldenbremse (debt brake) and wants to review all state spending to relieve the budget for the long term. The more than 300 grant programs are to be cut back substantially. The savings are to go to education, security and the economy.

The CDU wants to keep the debt brake. That is a rule against new debt. The state should check all its spending. There should be far fewer grant programs. The money saved should go to education, security and the economy.

All key policy areas are to remain adequately funded, combined with a critical review of tasks and spending. Transparent budget controlling and impact-oriented spending control are to form the basis. The tax administration is to be digitalized further and, with AI, stay effective even with fewer staff, focusing for example on tax investigation. Every income tax notice is to state clearly in future what the state spends its revenue on.

The CDU wants to achieve at the federal level that municipalities get a larger share of value-added tax revenue. As an alternative, it is considering letting counties and municipalities set their own multiplier on income tax. It also calls for a reform of the fiscal equalization system among the states.

Towns should get more of the sales tax. The CDU wants to push for that at the federal level. Otherwise, towns could set part of the income tax themselves. Baden-Württemberg should have to give less money to other states.

Redistributing VAT revenue is meant to improve municipal finances permanently. On fiscal equalization, the platform criticizes that recipient states use money from Baden-Württemberg to pay for things that the state itself cannot afford because of those payments. The CDU therefore wants to keep pushing for what it considers a fair reform.

The CDU wants to allow municipalities a separate multiplier with which they can ease the burden on owners of residential land. The reason, in its view, is excessive burdens from the property tax reform. Municipalities are also to be allowed to waive Grundsteuer A.

Towns should decide more on property tax themselves. They should be able to tax residential land at a lower rate. Then some owners pay less. Towns should also be allowed to drop the property tax on farmland and forest.

The separate multiplier for residential land is meant to cushion extra burdens that arose after the reform required by the Federal Constitutional Court. Deductions for individual plots that follow from data in state IT systems are to be applied automatically at the next general assessment. The platform justifies waiving Grundsteuer A, which covers agricultural and forestry land, by pointing to high administrative effort for little revenue.