NAfter violent protests from agriculture, the leaders of the traffic light coalition have weakened their plans to abolish tax benefits for the agricultural sector. “The abolition of preferential motor vehicle tax for forestry and agriculture will be waived,” said government spokesman Steffen Hebestreit on Thursday.
The abolition of the tax relief for agricultural diesel should also be extended over time. Federal Chancellor Olaf Scholz (SPD), Vice Chancellor Robert Habeck (Greens) and Finance Minister Christian Lindner (FDP) agreed on this on Thursday.
The original cutback plans had triggered massive protests from farmers and were also controversial within the coalition of the SPD, Greens and FDP. The farmers' association announced that it would demonstrate against the traffic light plans with various actions from January 8th.
The federal government justified the planned retention of the preferential vehicle tax for vehicles used in agriculture and forestry by saying that the affected companies would be spared “sometimes considerable bureaucratic effort”. However, the traffic light is fundamentally sticking to the move away from special conditions for agricultural diesel: 60 percent of the previous relief should still apply in 2024, 30 percent in 2025 and none at all from 2026 onwards.
The German Farmers' Association immediately criticized the agreed changes as inadequate. The cuts would have to be “off the table”.
The traffic light also decided on Thursday to postpone the change in the EU plastic levy until 2025. It has so far been paid for from the federal budget and should be passed on to manufacturers, retailers and consumers from 2024 onwards. The cuts agreed in mid-December were part of the compromise package with which Ampel wants to adapt its draft of the 2024 federal budget to the Federal Constitutional Court's latest decision on budget policy.
According to the government, the agreed changes reduce the relief for the 2024 budget by 2.5 billion euros. However, this gap can be closed through higher income from the most recent offshore wind power tender, other savings from the Ministry of Agriculture and more favorable budgetary key figures.
Habeck called the changes to the December budget compromise in favor of farmers a “good and fair way”. “We have spoken to each other intensively in the last few days because we see the burden on farmers,” the Green politician told the German Press Agency in Berlin on Thursday. We have now managed to find a solution that will help farmers.
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