FDP on finance and taxes

The FDP wants to keep the Schuldenbremse (debt brake) unchanged and rejects loosening it. A binding repayment plan is to apply to the state's old debts. The party justifies this with fairness between generations and room for future budgets.

The FDP wants to keep the debt brake. The debt brake limits new government debt. Hesse should pay off old debt under a fixed plan. This should put less burden on young people later.

The repayment plan is to set out how and by when the state reduces its debt; repayment should not happen only when finances are unexpectedly good. Extra surpluses are to go into reserves so the state can manage crises and downturns without new loans. The program puts general state debt at around 40 billion euros at the end of 2022. In the FDP's view, rising interest costs narrow the options of future generations.

The FDP wants to review all of the state's company holdings and keep only those that serve a clear state policy goal. Proceeds from privatizations are to go into an infrastructure fund.

Hesse owns shares in 49 companies. The FDP wants to review all of these shares. The state should keep only important ones. Money from sales should go into roads, networks and other infrastructure.

In the FDP's view, a holding is justified only if it pursues a clearly defined state goal, is of overriding public importance and contributes directly to that goal. Sale proceeds are to feed an infrastructure investment fund whose money is earmarked. This is meant to keep investment possible even when revenues are weak and during downturns. The aim is a higher investment rate for the state.

The FDP wants Hesse to invest more and plans to anchor an investment rate in the budget. Investment should be at least as high as depreciation. The priorities are education, infrastructure and digitalization.

The FDP wants Hesse to put more money into the future. The budget should have a fixed minimum level for this. The money should go mainly to education and infrastructure. Fast internet should also be expanded.

The floor at the level of depreciation is meant to ensure that public infrastructure does not lose value. More money is to go to education, especially early childhood education. For digitalization, the program lists better-equipped schools, fiber to the end customer with help for structurally weak areas, and open network access for all providers. Regional innovation centers, support for startups and a digital administration are also planned.

The FDP wants to digitalize and automate Hesse's tax administration further. Fees charged by the state administration are to be revised. For married couples, the tax office should choose the more favorable type of assessment on its own initiative.

The FDP wants to make tax offices more digital. Many things should run automatically. State fees should be reorganized. For married couples, the office itself should pick the cheaper way to calculate the tax.

For the tax administration, the program calls for training based on need, better continuing education, e-government and modern work organization. Risk management is to be developed further and processing sped up with IT-based cost-benefit analysis. The fee schedule is to be updated through leaner administrative processes, because in the FDP's view many fees do not match the work involved. The automatic check for the more favorable assessment is meant to ensure that citizens pay only the income tax they actually owe.

The FDP wants cash to remain an unrestricted means of payment and rejects a cap on cash payments. It sees cash as part of personal freedom because it allows saving and doing business without state monitoring.

The FDP wants to keep cash. Everyone should still be able to pay in cash without limits. The FDP rejects a maximum amount for cash payments. For the FDP, cash is part of freedom.

According to the program, there is no evidence that restricting cash fights terrorism or crime. The FDP objects to linking people who pay in cash with tax evasion across the board. It wants to oppose calls for abolishing cash early on. At the same time, it stresses that this is not a rejection of the opportunities of digitalization.

The FDP wants to abolish the Solidaritätszuschlag (solidarity surcharge) entirely because, in its view, it is no longer justified since Solidarpakt II expired. The partial abolition so far is not enough for the party.

The solidarity surcharge is an extra charge on top of tax. Today only some people still pay it. The FDP wants to abolish it for everyone. It says there is no longer a reason for it.

The program points out that revenue from the surcharge was higher than the money actually spent on rebuilding eastern Germany. The FDP is waiting for the pending case before the Federal Constitutional Court. If the court does not rule the surcharge unconstitutional, the party wants to push for abolition politically.

The FDP wants to scrap the solidarity levy that financially strong municipalities pay within municipal revenue sharing, arguing that it penalizes success. The state's trade tax levy is also to go, since in the party's view it presents municipal money as state money.

Wealthy cities and towns in Hesse pay a special levy. The FDP wants to abolish this levy. A levy on the local business tax should also go. The money should stay with the towns.

Municipal revenue sharing (Kommunaler Finanzausgleich) is to be reviewed and improved together with municipalities so that they are funded according to need. The FDP wants to abolish the trade tax levy even though the state constitutional court considers it constitutional in principle. The program criticizes that the state takes more than 400 million euros from municipalities this way. The FDP sees this as interference with local self-government.

The FDP wants to introduce a cap on municipal property tax multipliers because they are above average in Hesse. It rejects a statewide Grundsteuer C (a tax on undeveloped building land); municipalities should decide on it themselves.

Towns set how high the property tax is. The FDP wants a maximum limit for it. This should also protect renters from high extra costs. There should be no statewide extra tax on empty building lots.

The level of the cap is to be set by an expert study in close coordination with the municipal associations. The FDP also sees it as a limit on utility and service costs for renters. According to the party, Grundsteuer C encouraged speculation and hindered private housing construction in the past. If a municipality introduces it anyway, it should cut Grundsteuer B by the expected revenue.

The FDP wants to fund municipalities well enough that they can repair their roads and also do without Straßenausbaubeiträge (road improvement charges on adjacent property owners). To this end, state grants for municipal roads are to rise from 18 to 78 million euros.

Residents often have to pay when their street is renewed. The FDP wants towns to be able to drop these charges. For this, towns should get more money from the state. It should be 78 million euros instead of 18.

The relief is to run through municipal revenue sharing, which should take into account the need for maintaining and repairing municipal roads. The extra money is to go mainly to municipalities that belong to a county and be based on the road kilometers they are responsible for. The FDP points out that the investment backlog is especially large in rural areas. The decision on the charges stays with municipalities, which the party justifies with local self-government.

The FDP wants to raise the municipal share of sales tax and income tax and provide funds to municipalities without conditions. The goal is adequately funded local governments that no longer make land-use decisions mainly with business tax revenue in mind.

Towns and cities often have too little money. The FDP wants to give them a bigger share of taxes. The federal and state governments should fully pay for tasks they hand to towns. Towns should decide for themselves how to use the money.

The platform sees a flawed incentive in the fact that residential areas cause follow-up costs for schools and daycare, leading municipalities to prefer commercial zones. For delegated tasks, the federal and state governments are to provide the necessary money with no strings attached. The state's many funding programs are to be critically reviewed. Municipal financial needs are to be reassessed following the Alsfeld ruling, using transparent criteria agreed with the municipal umbrella associations. Municipalities that manage their budgets well should not be put at a disadvantage.