The law will be published in the Official Gazette and take effect the following day, except for R&D allowance amendments, which will come into effect on 1 January 2026.
Germany’s Federal Council (Upper House of Parliament/Bundesrat) has approved a bill for an immediate tax investment programme aimed at strengthening Germany as a business location on 11 July 2025.
This reform seeks to boost Germany’s attractiveness for investments, restore confidence in competitive business conditions following economic stagnation, and promote a return to sustainable economic growth.
One key aspect of this legislation is that the corporate tax rate will be gradually decreased from 15% in 2027 to 10% by 2032, starting with 14% in 2028.
In addition, this package also seeks to boost investment and growth by introducing enhanced depreciation, incentives for electric vehicles, and expanded relief for research and development.
On 26 June 2025, the Bundestag, Germany’s lower house of parliament, approved the “Act for an Immediate Tax Investment Programme to Strengthen Germany’s Business Location”, which introduces a EUR 46 billion corporate tax relief package to stimulate investment and drive economic growth.
The law will be published in the Official Gazette and take effect the following day, except for R&D allowance amendments, which will come into effect on 1 January 2026.
