Tax estimate 2027: More money, but “no new scope”

Despite the current crises, the federal government can expect more tax revenue next year than initially expected. Nevertheless, Finance Minister Klingbeil does not expect more leeway for the budget.

Tax estimate for 2027 Klingbeil sees “no new scope” despite additional income As of: October 22, 2026 • 5:54 p.m

Despite the current crises, the federal government can expect more tax revenue next year than initially expected. Nevertheless, Finance Minister Klingbeil does not expect more leeway for the budget.

The federal government can expect higher tax revenues next year than initially expected. The new tax estimate for 2027 assumes additional revenue of around four billion euros. The Federal Ministry of Finance announced this on Thursday.

At the same time, the government is probably not allowed to take on as much debt as Finance Minister Lars Klingbeil had planned. Additional wishes such as a reduction in electricity tax will probably not be financed through the tax increase alone.

“For 2027, we won’t gain any new scope overall, but we won’t have to close any new gaps either,” said Klingbeil in Berlin. “We will have to continue to consolidate the federal budget in order to create room for maneuver for the future,” he said. Anyone who now makes suggestions “such as reducing the electricity tax” should “at the same time also come up with suggestions on how to finance the whole thing,” said Klingbeil. He's open to that, "but I haven't heard these financing proposals yet."

After a presidential meeting in mid-October, the CDU promised a reduction in electricity taxes “for everyone”. This was actually already agreed in the coalition agreement, but Black and Red initially decided not to do so due to the lack of financial leeway. The final negotiations on the federal budget are currently underway. The Bundestag Budget Committee wants to finalize the draft on November 12th.

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Specifically, the estimators are now predicting a total of 10.9 billion euros more in tax revenue for the state in the coming year than was assumed in the last forecast in May. According to the forecast, tax revenue totaling 398.6 billion euros will flow into the federal budget in 2027. For the entire state, including the states and municipalities, the estimators expect revenue of just over one trillion euros. For the years up to 2030, the forecast shows a national increase of 43.4 billion compared to the May figures.

The tax estimation working group includes experts from the federal government, the leading economic research institutes, the Federal Statistical Office, the Bundesbank, the Advisory Council for Economic Development, states and municipalities.

The tax estimate is based on recent economic developments and laws with financial implications that have been passed since May. The federal government has just revised its economic forecast upwards - despite ongoing crises with global effects such as the Iran War.

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There were cautiously positive assessments of the tax estimate from the ranks of the government coalition. SPD budget politician Thorsten Rudolph spoke of a success for the federal government, whose investment offensive is working. His Union colleague Christian Haase (CDU) was more reserved: "Despite the better revenue development, unfortunately there cannot be an all-clear for the federal budget."

However, there was criticism from the opposition. Green Party budget officer Sebastian Schäfer described the higher income as an "economic flash in the pan" that does not solve the municipalities' financial problems. Left-wing politician Doris Achelwilm accused the government of having wrong priorities. “More revenue cannot hide the fact that the federal government is setting the wrong priorities,” she explained and called for cuts to families and social services to be reversed.

Christoph Mestmacher, ARD Berlin, on the new tax estimates from Finance Minister Klingbeil tagesschau24, October 22nd, 2026 • 4:00 p.m. Municipalities want more money - business associations relief The German Association of Cities, in turn, called for the unexpected additional money to be used for the municipalities. The federal and state governments must “relieve the burden on completely underfinanced municipal budgets with their additional revenue,” demanded the German Association of Cities.

Business and industrial associations warned that the scope for relief should be used. For example, the craft association ZDH called for the promised electricity tax reduction to be implemented. The industry association BDI and the German Chamber of Commerce and Industry (DIHK) made similar statements, speaking of a mandate to strengthen competitiveness.

The Taxpayers' Association joined the demand for the electricity tax reduction and called for further relief - for example with income tax.