Bundesfinanzminister Lars Klingbeil (SPD) has unveiled a broad reform package for the current fiscal year aimed at closing an impending gap of several hundred billion euros in the budget. In the same announcement he has introduced a planned overhaul of the inheritance tax system.
“Unsere Reformen werden allen etwas abverlangen” Klingbeil told the FAZ. He stressed that the decisions taken this year must shape the rest of the legislative period, calling the approach a “strict consolidation course” with “very sweeping decisions”. He added that, on its own, the 2028 budget must cover a deficit exceeding 60 billion euros.
The package will not rely solely on cuts to subsidies or other expenses; the overhaul of inheritance taxation is also a key element. Klingbeil emphasized that the current system is unfair, pointing out that smaller inheritances are taxed heavily while larger fortunes receive minimal relief. He said the aim is to eliminate such inequities and to structure the reforms so that only those with substantial wealth or high incomes are exempt from contribution, arguing that a large reform package cannot succeed if the broader society is left out.
Economists have recently described a rise in the value‑added tax (VAT) as almost inevitable given the size of the fiscal gaps. When asked whether a VAT increase could be ruled out, Klingbeil replied simply that “we did not include a VAT increase in the coalition agreement”.