Germany's Scholz promises billions in tax deductions for businesses

German businesses are set to receive billions of euros worth of tax breaks under the terms of a preliminary 2025 budget deal reached by the coalition parties on Friday.

German Chancellor Olaf Scholz said in Berlin that the new financial plan will allow businesses to deduct investments and research expenditure from their tax bills, while applying for subsidized loans from the state KfW investment bank to encourage economic growth.

Vice Chancellor and Economy Minister Robert Habeck praised the deal, speaking of a "new economic dynamism" in Germany.

Scholz also highlighted reductions in bureaucracy, with further laws planned. In addition, electricity price subsidies are to be extended until 2030, while the government will undertake further measures to reduce grid costs.