On 3 February 2022, the German Ministry of Finance has introduced a bill that provides further measures to support taxpayers during the COVID-19 pandemic. The draft bill primarily provides for the retention of transitional measures that have already been introduced. The draft law provides for the following measures:
The loss carry-back maximum amount increases for the tax years 2022 and 2023 from EUR 5 million to EUR 10 million. In addition, the loss carry-back period will be increased from 1 to 2 years from 2022.
Extension of the temporary declining balance method for movable assets in tax years 2020 and 2021 for assets acquired or manufactured in 2022. For the year 2022, the annual depreciation rate maybe two and a half times the permissible straight-line rate with a maximum of 25%.
The draft bill must be approved by the government and then go through the legislative process and be approved by the upper and lower houses of the German parliament.
