Federal Chancellor Friedrich Merz of the CDU will reportedly give employers an additional year to distribute a planned “relief bonus” of 1,000 euros to their employees tax- and contribution-free. Speaking on Thursday on the sidelines of the visit by the Irish head of government, Merz stated that this offer-which is intended to be valid for 2026 and 2027-is meant to offer both employers and employees. While he acknowledged criticisms regarding the measure, the Chancellor asserted that he does not share them, emphasizing that it is an offer from the government to provide relief on taxes and social security contributions to businesses and employees during a difficult time. Prior indications suggested that the ruling coalition might extend the deadline, which was initially set through the last coalition committee meeting until December 31, 2026. A spokesperson for the Federal Ministry of Finance had already made such suggestions to the dpa news agency on Wednesday when questioned about a possible extension of the deadline. The spokesperson added that a parliamentary procedure might “very naturally” be necessary for further deliberation. Furthermore, the spokesperson stressed that the “relief bonus” should be modeled after the “inflation adjustment bonus” which covered a period of approximately 26 months, running from the end of 2022 to the end of 2024.
Merz Extends Tax Break Premium For Workers Until 2027
