The Federal Council has unanimously approved the Investment Acceleration Programme for Economic Growth, previously passed by the Bundestag. The legislation aims to stimulate new investment within the national economy through several key adjustments to tax regulations.
A central element of the programme allows companies to apply accelerated depreciation for machinery and equipment purchases. Businesses can now deduct up to 30 percent of these expenses from their taxes over the current and subsequent two years. This accelerated write-off is intended to ease the financial burden after acquisition, freeing up capital for future investment cycles.
The legislation also outlines a phased reduction of corporate tax rates following the expiration of a previous incentive scheme. Beginning in 2028, the corporate tax rate will be gradually lowered, ultimately reaching 10 percent by 2032, a decrease from the current rate of 15 percent.
Further incentives are included to encourage the adoption of electric vehicles within the business sector. The programme offers significant depreciation allowances for the purchase of fully electric vehicles, allowing for a 75 percent write-off in the year of acquisition. Simultaneously, the price ceiling per vehicle has been raised from €75,000 to €100,000.
To foster innovation and expand research and development activities, the legislation broadens the scope of the research grant program. The upper limit for calculating the grant will be increased from the current €10 million to €12 million, applying to the period spanning 2026-2030.
