CDU on finance and taxes

The CDU wants to free mid-sized businesses from red tape and lower their tax and contribution burden. Through the Bundesrat it wants to reverse the early due date for social insurance contributions and expand the tax loss carryback.

The CDU wants to ease the load on companies. They should pay less in taxes and charges. There should also be less paperwork. Companies should be allowed to pay social contributions later. That leaves them more money.

According to the platform, the aim is to improve the liquidity and equity of mid-sized firms. The early due date means employers must pay social contributions before the end of the month; the CDU wants to change this with a Bundesrat initiative. For the loss carryback, which lets firms offset current losses against earlier profits, it seeks an expansion in both time span and amount.

The CDU wants to stick to the debt brake while investing in public infrastructure. All state spending is to be reviewed continuously for effectiveness and cut or eliminated where needed.

The debt brake limits new government debt. The CDU wants to keep this rule. The state should still invest in roads and buildings. The CDU wants to check all state spending again and again. It wants to cut or end spending that has little effect.

The platform regards sound finances as the basis of governing and as protection against excessive inflation; in its view the debt brake secures room to maneuver for future generations. The CDU wants to keep the federal-state fiscal equalization system, through which Saarland, by its account, receives more than 400 million euros a year in restructuring aid. Structural budget items are to be checked for efficiency. If their effect falls short of the goals, they are to be reassessed, reduced or eliminated in later budgets. The platform also calls for tax policy that favors growth, performance and investment.

The CDU wants to raise public investment with a special infrastructure program and set up a "Saarlandfonds" (Saarland fund). The fund is meant to boost investment without breaching the debt brake and to serve as an investment option for savers and investors.

The CDU wants to put more money into buildings, administration and transport. It plans a special program for this. There should also be a Saarland fund. Savers and investors can put money into this fund. The debt brake should still apply.

The special program is to cover public infrastructure, buildings, administration, municipal facilities and transport and, according to the platform, help prevent a recession after the COVID-19 crisis. The Saarland fund is conceived as an innovation and structural fund that helps modernize the capital stock of Saarland's economy. It is to be open to local savers and international investors. The CDU also wants to push for making declining-balance depreciation for capital goods permanent, especially for digital and climate investments.

The CDU calls for scrapping the solidarity surcharge entirely. It considers the surcharge no longer justifiable more than 30 years after reunification and given higher tax revenues.

The "Soli" is an extra charge on top of income tax. Since 2021 most people no longer pay it. The CDU wants to end it for everyone. It says the charge no longer fits the times.

The platform calls the surcharge an anachronism and points to constitutional questions. The relief in place since early 2021 covers about 90 percent of payers, but the remaining 10 percent bear almost half of the revenue. As a further reason, the CDU notes that Solidarpakt II (the second solidarity pact for eastern Germany) expired at the end of 2019. In its view the surcharge can no longer be justified to cover short-term peaks in the federal budget.

The CDU supports uniform nationwide exemption thresholds for the Grunderwerbsteuer (real estate transfer tax). This is meant to make buying a home easier, especially for young families, with a federal program covering the cost.

People who buy a house or apartment pay a tax. The CDU wants part of the purchase to be tax-free. This should help young families most of all. The rule should be the same across Germany. The federal government should pay for it.

The party wants to pursue the plan together with other German states. The thresholds are to apply uniformly across Germany. The lost revenue is to be offset through a federal program, comparable to the Baukindergeld (a federal home-buying grant for families).

The CDU wants Saarland's Gewerbesteuer (local business tax) rates not to exceed the national average in the long run. It considers a state-backed reduction program feasible only if the federal government takes part through a municipal debt relief strategy.

Companies pay a business tax to their town. Each town sets the rate itself. The CDU wants this tax to go down in Saarland. It should not be higher than the German average. But the state needs help from the federal government for this.

Lower rates are meant to make Saarland more attractive for investment and new businesses and, in the CDU's view, can ultimately lead to higher tax revenue. Under a reduction program, the state would partly compensate municipalities for lost revenue. The party wants the business tax to be paid where companies actually use infrastructure. For Germany as a whole, the platform calls for a corporate tax system that reflects performance.

The CDU wants Saarland's municipal fiscal equalization system reassessed soon and reviewed regularly so that money is distributed according to actual need. It calls on the federal government to take over the legacy debts of financially weak municipalities.

Many towns in Saarland have little money. The CDU wants to check how money is shared between the state and the towns. The sharing should be fair. The federal government should take over old debts of poor towns.

According to the platform, the Saarlandpakt does relieve municipalities of short-term loans, but tasks and investment needs keep growing. The review is to cover both the split between state and municipalities and the split among municipalities. The CDU wants to implement improvements recommended by independent experts. It reminds the Chancellor of an earlier promise on legacy debt relief.

The CDU wants to ease the burden of energy prices on households and businesses. It calls for electricity tax at the EU minimum, a faster end to the EEG surcharge (renewable energy levy), a temporary cut in fuel tax and a higher commuter allowance.

Energy has become expensive. The CDU wants to cut taxes on energy. The tax on electricity should be as low as possible. The tax on gasoline and diesel should also go down for a while. Commuters should be able to deduct more from their taxes.

Electricity tax is to fall to 0.1 cents per kilowatt-hour, the lowest rate the EU permits. The EEG surcharge on electricity is to be abolished earlier than currently planned. Fuel tax is to be lowered for a limited period. The CDU also seeks a higher commuter allowance. The reasoning given is that private and commercial consumers must not be overwhelmed by rising prices.

The CDU wants to deepen relations with Luxembourg through a dedicated strategy. It will lobby the federal government for a revised double taxation agreement allowing 52 home office days a year and for cross-border workers to count more when tax revenue is distributed to municipalities.

Many people from Saarland work in Luxembourg. The CDU wants closer cooperation with Luxembourg. Commuters should be allowed to work from home 52 days a year. Luxembourg and Germany should share the taxes for those days. Towns with many commuters should not lose out on tax money.

Alongside the France Strategy, a strategic approach for Luxembourg is to be created covering tax, economic and cultural cooperation. When income tax revenue is allocated to municipalities, the employment rate should not be the only yardstick, because commuters working abroad are otherwise left out. With Grand Est and neighboring German states, the CDU wants pragmatic solutions for obstacles to free movement such as the A1 certificate and for cross-border investment projects. The German states are to coordinate more closely with one another, putting cooperation before competition.