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Policy Article

Subsidies in Times of Tight Budgets

Wirtschaftsdienst

Authors

  • Laaser
  • C.-F.
  • Rosenschon
  • A.
  • Schrader
  • K.

Publication Date

DOI

10.2478/wd-2023-0233

JEL Classification

H23 H50

Key Words

fiscal policy and budget

Germany

tax policy

subsidies

subsidy reduction

federal spending

Related Topics

Tax Policy

Fiscal Policy & National Budgets

Germany

The decision of the Federal Constitutional Court to classify the transfer of €60 billion in unused coronavirus loan authorisations to the Climate and Transformation Fund as unconstitutional has plunged fiscal policy in Germany into a crisis. A “cash audit” is therefore called for. This article draws on the findings of the Kiel Subsidy Report. According to the budget plans for 2022 and 2023, federal financial aid is set to increase sharply. In 2023, they are expected to be even higher than the federal government’s social spending. Financial aid should therefore not be left out in order to counter-finance budget gaps.

Kiel Institute Expert

  • Dr. Klaus Schrader
    Kiel Institute Researcher

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