Germany Sees €43.4B Higher Tax Revenue Through 2030 but No New Fiscal Leeway, Finance Minister Says

Germany's finance minister said higher-than-expected tax revenue estimates will not provide additional fiscal headroom, as Berlin continues consolidating its federal budget despite a modest upgrade to projections. The council of tax experts expects €43.4 billion ($48.6 billion) more in tax revenue from 2026 to 2030 than forecast in May, but only €3.3 billion of that will flow to the federal government over the five-year period, with states and municipalities receiving the bulk. For 2026, the panel projects total government revenue of €997.9 billion. Finance Minister Lars Klingbeil said the upgrade reflects a nascent recovery in Europe's largest economy. The government raised its growth forecast to 1.3% for 2026 and 1.1% for 2027, up from 0.5% and 0.9% previously. For 2027, federal tax revenue is seen €4.1 billion above May forecasts, but planned tax relief will absorb €1.7 billion and the debt brake's cyclical component a further €2.5 billion. Klingbeil said a €22 billion budget shortfall remains for 2028.