The German Finance Ministry has announced tax revenues in the country are likely to reach a record high this year despite the eurozone debt crisis. A robust labor market and private consumption have been key factors.
Fresh statistical data published on Monday revealed that tax revenues in Germany increased again in September, keeping a longer trend fully intact and promising a record windfall throughout 2012.
The Finance Ministry in Berlin said an additional 50.8 billion euros ($66.2 billion) were washed into state coffers in September, up 4.2 percent year-on-year.
The ministry attributed the positive development first and foremost to a continuously stable employment situation in the country. Tax revenues from people’s income reached more than 11 billion euros in the month under revision, marking a 7.6 percent hike over last year’s levels.
Revenues big, spending too
Corporate tax increased to 16.7 billion euros, surprising analysts for yet another time this year. Between January and the end of September, German tax revenues thus swelled to over 400 billion euros, not least due to an increase in private consumption in the wake of wage hikes in many sectors of the economy.
Financial experts said they expected a windfall of more than 600 billion euros in tax revenues throughout 2012, which would mark a new record high in the history of the country.
But despite the cash injection into the federal and regional budgets, Germany will not be able to do without fresh borrowing next year, although the rate will be decreased considerably.
The country’s 16 states alone have already indicated they’ll need to borrow over 15 billion euros in 2013 to provide adequate community services.