"Change the Budget, Invest in a Greener Future!"
The coalition of two political parties, the Traffic Light Coalition, finally reached a consensus on a federal budget for 2024. Following sleepless nights of negotiations between Chancellor Olaf Scholz (SPD), Vice-Chancellor Robert Habeck (Greens), and Finance Minister Christian Lindner (FDP), the budget will be presented on ZDF's "Maybrit Illner" talk show for public discussion.
As we step into 2024, it's important to be aware of potential cost increases related to heating, electricity, and fuel. However, with the little information disclosed so far, it's challenging to provide an accurate assessment. What we do know is that the budget aims to uphold the debt brake and promote economic transformation, keeping the social component in mind.
While initially planning to allocate 17 billion euros, the Federal Constitutional Court's ruling has cut the government's funds by the same amount. In response, Chancellor Scholz promised the citizens that changes meant for their daily lives would remain unchanged. As we are now learning, this promise seems to be falling short.
The Green Party leader, Ricarda Lang, justifies the increasing CO2 price, stating that they are merely returning to their originally planned trajectory without any relief measures. She mentioned that reductions in income tax and the abolition of the EEG levy would actually refund half of the CO2 revenue to the citizens. Additionally, the reduction in electricity tax will provide relief for companies and avert attacks on the welfare state.
In the same vein, FDP parliamentarian Christian Dürr mentioned the government's intention to create work incentives for recipients of citizen's allowance, aimed at lessening the burden on taxpayers. Although the specifics are yet to be defined, he suggested that the government ought to enact severe penalties for "total refusers" who fail to cooperate with employment agencies.
The Director of Finanztip, Hermann-Josef Tenhagen, highlighted the likely impact of the war in Ukraine on consumers, including the end of the energy price break, increased VAT on gas, and higher CO2 taxes. Worse still, district heating customers might experience the severest penalties.
Despite the tracing of legal grey areas, one thing is certain; in 2024, citizens will have to adjust their budgets to accommodate rising costs. The CDU's Helge Braun has expressed his strong stance against suspending the debt brake, pledging that the CDU/CSU will not tolerate any violation of the Basic Law for policy implications, regardless of the merits involved.
While brace yourselves for increased costs, let's embrace eco-friendly alternatives and stimulate climate-aware businesses, transforming our future into a more sustainable and greener one.
[1] Source: Environmental Defense Fund [2] Source: Council of European Energy Regulators [3] Source: Federal Constitutional Court [4] Source: Eurostat
