Concerns are mounting ahead of a parliamentary debate in the Bundestag regarding the 2025 federal budget and financial planning extending to 2029. The German Taxpayers’ Association is warning of a significant surge in interest costs for the federal government.
According to the association’s president, Reiner Holznagel, currently at 30 billion euros, federal interest expenses are projected to rise to 62 billion euros by 2029. Holznagel stated that this increase would essentially consume any additional tax revenue generated between now and 2029. He argues that government debt policies are diminishing the state’s financial flexibility and capacity for strategic decision-making.
The association president also criticized the government’s decision to transfer approximately 55 billion euros from the regular federal budget into a newly established special fund. Holznagel characterized this move as accounting maneuvers and a shifting of resources, rather than providing fresh impetus for investment. He alleges the government is reducing planned investment expenditures in the main budget, artificially inflating the official investment rate. These investments are then reappearing within a new infrastructure special fund, but financed through debt rather than through tax revenue, a practice he described as a “blatant relabeling” of funds.