German coalition backtracks on taxes, welfare in budget talks, lawmakers say
EWG•Germany’s governing coalition postponed a sugary-drink tax until 2028, shelved a planned plastic levy and reversed some planned welfare cuts as it works through the 2027 budget. Lawmakers have not found funds for a planned electricity tax cut.
1. Tax and welfare changes
The coalition will introduce the sugary-drink tax in 2028 instead of mid-2027 and will not introduce the planned tax on plastic packaging for now. It also agreed to reverse some planned welfare cuts, including payments for low-income parents.
2. Budget negotiations
The CDU/CSU and SPD are resolving remaining issues for the 2027 federal budget. The government earlier proposed a budget worth €555.4 billion, while lawmakers have not found funds for a planned electricity tax cut for all consumers.
