Germany needs another extra budget to cushion #Coronavirus impact - #Merkel ally

Eckhardt Rehberg told RND media group in an interview that federal and state governments were likely to get about €100 billion less in tax revenues this year than previously estimated due to the effects of the coronavirus crisis.

“If the five years to 2024 are summed up, there will probably be a minus in the middle three-digit billion euro range,” Rehberg said, adding that the federal government therefore had to work on another supplementary budget.

“I see little scope for large and permanent tax cuts,” Rehberg said, adding that he was also against cash incentives for consumers to buy a new car.

Germany has already approved an initial rescue package worth over €750bn to mitigate the impact of the coronavirus outbreak, with the government taking on new debt for the first time since 2013.

The first package agreed in March comprises a debt-financed supplementary budget of €156bn and a stabilization fund worth €600bn for loans to struggling businesses and direct stakes in companies.

Finance Minister Olaf Scholz will present updated tax revenue estimates for all state levels on 14 May.

In the last few years bumper tax revenues have contributed to a budget surplus. However, Europe’s biggest economy is braced for its deepest recession since World War Two due to the coronavirus lockdown.