BERLIN / LONDON (IT BOLTWISE) – The coalition’s recent decisions to cut aviation tax and introduce a subsidized industrial electricity price are met with mixed reactions. While the aviation industry welcomes the tax adjustment, environmental activists express sharp criticism. The measures are intended to strengthen the economy, but raise questions about climate policy.
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The German coalition has decided to reduce aviation tax to support the aviation industry. This decision was received positively by the industry, but met with criticism from environmental activists. The tax adjustment is seen as a move intended to strengthen the competitiveness of the aviation industry, while critics highlight the negative impact on the environment.
The aviation tax, originally introduced in 2011 to support the state budget, is scheduled to be reduced from July 2026. This measure is expected to bring savings of around 350 million euros annually for the aviation industry. At the same time, the coalition plans to reduce air traffic control costs in order to further ease the burden on the industry.
At the same time, a subsidized industrial electricity price for energy-intensive companies will be introduced. From January 2026, a target price of 5 cents per kilowatt hour will apply, financed by the Climate and Transformation Fund. This measure aims to strengthen the competitiveness of German industry, but is viewed critically by the Greens as they question the connection with climate protection measures.
The introduction of new gas-fired power plants is also part of the coalition’s plans to close supply gaps in renewable energy. These power plants should be designed to be open to technology so that they can be converted to emission-free operation in the medium term. Government funding is intended to make investments in this infrastructure attractive, although approval from the EU Commission is still pending.
Another aspect of the coalition’s decisions is the creation of a ‘Germany Fund’, which is intended to strengthen private investments. The aim is to improve the entrepreneurial environment for young, innovative companies and to catch up with Germany’s lag in this area. These measures demonstrate the government’s efforts to stimulate the economy while confronting climate challenges.
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