Germany’s tax revenues continue their upward trend, according to the Federal Ministry of Finance’s monthly report released Tuesday. Income surged by over 7 percent in June compared to the same period last year.
Value-added tax (VAT) remains a significant driver of this growth, exhibiting a substantial increase of 7.2 percent, mirroring the pattern observed in May. Conversely, income tax revenue experienced a more modest rise of 2.6 percent, a difference from the previous month’s performance. Revenue from the capital gains and interest withholding tax saw a comparatively smaller increase of 12.5 percent compared to earlier months this year. Corporate income tax revenue, however, registered a slight decrease of 2.8 percent year-on-year.
Federal tax revenues in June were notably higher, approximately 10 percent above those of the previous year. A significant portion of this increase is attributed to a robust rise in tobacco tax revenue, bolstered by a weaker comparative basis in June 2023. The Ministry also reported growth in revenues from energy tax, solidarity surcharge, insurance tax, motor vehicle tax and electricity tax.
State tax revenue experienced a more pronounced increase, climbing 25 percent compared to June 2023. This surge is primarily driven by increases in both key state taxes: real estate transfer tax and inheritance tax. Real estate transfer tax revenue remained in the range of €1.2 billion to €1.3 billion, representing an increase of approximately 24 percent over the previous year. Inheritance tax revenue was up nearly 36 percent; this tax category is known for its inherent volatility in monthly revenue figures.
The Ministry’s report added that if revenue levels remain similar in the coming months, growth rates are likely to appear comparatively lower due to a stronger base for comparison with prior year data.
