In the year following the purchase, another 10 percent can be deducted, followed by 5 percent in the subsequent two years and 2 percent in the fifth year. This special regulation will apply for purchases made between July 2025 and December 2027 .
Klingbeil Aims to Create New Investment Incentives
In addition to tax advantages for electric vehicles, a so-called “Investment Booster” is also planned. This initiative will allow companies to immediately write off investments in machinery or other movable assets by up to 30 percent from 2025 to 2027 . This special depreciation method will be effective from June 30 of this year until early 2028 .
Corporate Tax Rates Set to Decline
Long-term, Finance Minister Klingbeil is aiming to reduce the corporate tax rate from 15 percent to 10 percent . This reduction is intended to be rolled out in several phases starting in 2028 , aiming for completion by 2032 . Furthermore, profits retained within companies will also be tax-advantaged in the future.
Increased Funding for Research
An additional component of the proposed legislation is the expansion of tax incentives for research . Companies investing in innovation and development will benefit even more from these incentives going forward.
Gradual Relief for German Companies
The financial relief for German companies is expected to gradually escalate, reaching 17 billion euros by 2029 . Klingbeil intends to implement multiple measures agreed upon by the Union and SPD in the coalition contract. These expected shortfalls in revenue will impact the federal government, states, and municipalities alike.
The draft has been forwarded to other ministries for their feedback. The proposals require the approval of both the Bundestag and the Bundesrat .
This announcement was broadcast on June 1, 2025 , by Deutschlandfunk .